Kentucky Bankruptcy Law

Counsel with Care

$@&# HAMPens: Home loan modification revisited

I am currently sitting in a continuing legal education training with hundreds of other Kentucky lawyers listening to a foreclosure defense seminar. Of the approximately 10% of the attorneys who have attempted to help make home loan modifications for clients, NONE have had success. This is not a scientific study, but I thought I would offer it as a follow-up to my prior post, Miracles HAMPen.

Other information offered include: though the foreclosure crisis has plateaued  it has not abated; banks only have to decide if the modification will profit THEM more than foreclosure, they have no incentive to get good information to KNOW the answer, so they default to “no, it won’t profit us”; short sale offers are being denied even if reasonable; and nothing has really changed in the court system.

Now, there are many strategies to defend against foreclosure actions, but the real dilemma is that people who have not been able to catch up on their home loans are not likely to be able to afford a lawyer. I explain to people that they can pay me to defend against a foreclosure, but most of the time the bank will likely prevail AND they will likely still have to look at bankruptcy though I will be able to buy some time. Or, they can invest the legal fees into going ahead and doing a Chapter 13 which forces the banks and other creditors onto a level playing field. I just want people to make an informed choice based on the circumstances.

October 31, 2012 Posted by | attorney fees, Bankruptcy, Chapter 13, Foreclosure, Home loan modifications, Planning, Pre-filing planning, Property (exempt, reaffirm or surrender), Security interests | , , , , , , , | Leave a comment