We have recently written about short sales as a means of avoiding foreclosure or bankruptcy, so this week we will mention loan modification as another way to avoid losing your house and credit.
A loan modification is one possible tactic available as part of a foreclosure prevention strategy. Obtaining a loan modification is a complex process that involves discussions with your mortgage company and others, perhaps a HUD counselor. The main problem with this solution, especially if you have already received notification of foreclosure, is the amount of time it takes to reach all of the parties involved and to then negotiate a modified loan – all while the clock is continually ticking toward a looming deadline.
The proposed Foreclosure Modification Act (California A.G. File No. 11-0014), which has a chance of appearing on California’s November 2011 ballot if enough signatures are gathered, would make a mortgage loan modification a requirement by lending institutions if certain economic criteria exist in the marketplace, such as the nationwide real estate devaluation as a result of the recent recession fueled by the collapse of the housing market.
The concept behind the proposed initiative is that individual homeowners need protection against external market forces over which they have no control, such as when residential properties lose huge chunks of their “value” while the economy seems to be entering the second half of a double-dip recession with few new jobs available.
We won’t comment about the financial affect of outlawing foreclosures, but you can read qualified nonpartisan projections in this review of the proposed constitutional amendment by the Legislative Analyst’s Office, California’s Nonpartisan Fiscal and Policy Advisor.
If you are approaching a foreclosure, we will comment about your need to fully understand the current laws and all of the available options today, including a short sale or a loan modification. You can start learning about your current rights by reading the California Department of Real Estate’s FAQ for Consumers, about the California Foreclosure Prevention Act, which was signed into law in February 2009.
In a stressful situation with deadlines quickly approaching, it can be hard to think straight and properly deal with all of the paperwork and calculations involved in legal and financial aspects of your life – and a possible foreclosure. And it can be even harder to determine exactly what is the best option for reversing a bad financial situation, without completely understanding the real estate market and knowing the full legal and financial implications of your decisions.
At the Law Offices of Connie Yi, P.C., we understand the uphill battles brought on by a difficult financial period. As a full-service tax law, estate planning and accounting firm, we are uniquely qualified to help guide you through all of your legal, financial and real estate negotiations and transactions, so you emerge as unscathed as possible and in a position to rectify your financial position and move your life forward.
Connie Yi is a California Attorney, a Certified Public Accountant, and a licensed Real Estate Broker who understands all of the aspects of a loan modification in today’s market and she will help you handle the details quickly and efficiently to your best advantage. If you fear you will soon lose your home, please contact us, before it is too late.