Articles Posted in Mortgage and Foreclosure Defense

Mortgage and Foreclosure Defense. We have been in a major mortgage fraud scandal involving robot-signers, fake documents, false affidavits and assignments for quite a while now. Mortgage payment servers make more money when they foreclose than they do taking your regular monthly payments. The ability to sue your mortgage company while you are in bankruptcy and protected from foreclosure gives you a huge advantage. You can bring all your claims and allegations against the mortgage company in a court that was set up to protect you from abuse by creditors.  A foreclosure in Mississippi is almost always done without any court supervision and it is done fast, in a matter of weeks. A lawsuit is not required – we are a non-judicial foreclosure state. Therefore, in order to stop the foreclosure you have to take one of the following actions: 1) get the mortgage company to agree to cancel the sale, 2) get the mortgage company to agree to modify your loan, 3) pay all the money they claim is due, 4) file a lawsuit against your mortgage company, or 5) file bankruptcy.  The 5th method is by far the strongest and puts YOU in control.  Mortgage and Foreclosure Defense within a bankruptcy case gives you, the consumer, the advantage. The other options leave the mortgage company in control with you at their mercy – hoping that they will do as they promise – hoping that even though you are being “reviewed” for a modification, that they won’t still foreclose – and hoping that they will at some point come to their senses about the balance they claim you owe.

scam-rent_mortgage-150x150Beware of scams dealing with emergency rental assistance! Scammers are coming out of the woodwork with all the various federal relief programs being implemented across the country. They are excellent at disguising their programs to look 100% legitimate.  If you receive and email, text, call, or social media message from someone claiming to be a part of the government, chances are this is a scam.  Same thing if you are asked for cash, gift cards, wire transfers, cryptocurrency or similar forms of payment to help you get the rental assistance they say they are willing to provide – chances are this is a scam.  For trustworthy information, ALWAYS go to the source directly and visit the government or official websites.

To get rental assistance, renters must apply to a state or local rental assistance program. Click here to visit this website to find rental assistance programs in your area. This is the direct link to the Consumer Financial Protection Bureau.  You can also go here and log a complaint. If you have been solicited by scammers – report them! Help shut them down.

The Federal Trade Commission issued a warning about rental assistance scammers recently. It’s a shame that there are people out there that take advantage of others that are in a desperate situation. There are legitimate organizations out there that can help – you just have to be so careful about who you deal with.

A paper written by David Bernstein, an economist at the U.S. Treasury, argues that credit card debt can play a part in families losing their homes and that this debt is deepening the mortgage crisis.  He posted this paper as a private citizen, but utilized information from the Survey of Consumer Finance.  Credit card debt, mortgage foreclosures, and access to bankruptcy are linked.

He studied families whose mortgage payments take more than 40% of their income.  Within this group, it is 21 times more likely that they will default on their mortgage payments than people who utilize less than 40% of their income to pay for their mortgage.  But, if these families eliminated their credit card debt, about 1.5 million households could bring their mortgage payments down below that 40% range and increase their chances significantly in keeping their homes.

He also noted that in order to save their homes, more homeowners should consider bankruptcy.  Even if you can’t redo your mortgage, if they were to write off enough of their other debt, they would be able to make their payments.  Bankruptcy offers many more options than people realize and often is significant in helping families to receive a modification to their mortgage.

divorce houseIt is common in a divorce proceeding that involves a marital home and/or vehicles that a property settlement agreement or final judgment obligating one spouse to pay the mortgage or vehicle note will be a part of the divorce decree.  This will constitute a non-dischargeable (can’t be wiped out in a bankruptcy) obligation. BUT, what if, as so often happens, that obligated former spouse fails to pay the debt, the home is foreclosed, or the vehicle repossessed and a deficiency judgment is entered on the balance remaining owed to the mortgage company or the creditor that financed the vehicle?

Example:  The wife was awarded the marital home.  The divorce decree required her to refinance within two years of the divorce, but it was silent as to who (wife or husband) was responsible for paying the current mortgage.  The wife failed to pay the mortgage, the house foreclosed, and a deficiency judgment was entered against the wife AND the husband The wife filed a bankruptcy to wipe out this debt.  He filed a motion requesting an order of non-dischargeability of the wife’s purported obligation to pay the mortgage and deficiency judgment. In other words, he tried to block her ability to wipe this debt out in her bankruptcy – make it “non-dischargeable”.  He lost because the divorce decree was silent as to who should bear the burden of any deficiency that may arise as the result of a foreclosure sale of the parties’ former residence.  So he then would have the choice to pay the deficiency or file bankruptcy himself to wipe out this debt.

Regardless of which side you may be on in such a scenario, it is key to have your bankruptcy attorney review the wording of your divorce decree to advise you on what can / cannot be wiped out in a bankruptcy filing.  And if you are reading this and have not yet finalized your divorce agreements, it is key to always have stated who will be responsible for the current/future note or mortgage, as well as who should bear the burden of a deficiency judgment resulting from any foreclosure or repossession in your divorce decree.

At least twice a month I receive calls from homeowners who are in the middle of the modification process with their mortgage company and they get notice of a foreclosure.  Over and over they had been told the modification was still being reviewed.  In some cases they were told they’d been approved.  But all of a sudden they find their home is being advertised in the newspaper and a sale date is set at the courthouse. Mortgage companies review loans for modification and try to foreclosure at the same time.  This is known as “dual tracking”.  They don’t stop the foreclosure process when a mortgage is considered for a modification.  If you are in the modification process with your mortgage company you can never assume that it will be approved or they won’t foreclose.  The foreclosure process in Mississippi is quick, so you can’t trust anything they tell you over the phone.  If you become aware your home is in foreclosure, contact our office immediately.  We can stop the foreclosure sale through filing a Chapter 13 bankruptcy and you can still follow-up with a modification, if needed.  You never want to be in a position of trying to get your home back after the foreclosure.  Better to be safe than sorry and stop the foreclosure before it happens.

modification faxes

You’re trying to work through the process of getting a modification of your home loan and you can’t seem to ever get the same person on the phone.  When you talk to one person, they give you different answers, pass you around, or claim the information you provided was to another department so they need you to repeat it.  Maybe they can’t find any record of your information at all.  You’ve faxed the same paperwork multiple times – only for it to “disappear” or to “never have arrived”.  You’ve mailed the information but “a page or two is missing”.  You mail it again and somehow different pages aren’t there now.  Is it just you? NO! Can a huge company be this incompetent? Is it a consipiracy? A stall tactic?

Your mortgage company does not want to give you a modification. It’s “let the games begin” time. It’s not your fault. They simply make more money foreclosing. Don’t believe me? Investors are the ones that own your mortgage.  The mortgage company or mortgage servicer is simply servicing the loan – collecting your payments and passing them on. Let’s say they make $250 a year for doing this.  But if you’re late – hey!  They get late fees, can then tack on assessment fees, attorneys fees, modification screening fees (I said screening – they are not incented to actually give you a modification), foreclosure processing fees, and on and on and on.  These fees that they get to keep can add up to thousands! And oh yeah – they tell you not to pay your normal note while they are screening you for this modification.  Why? Because you will then get farther and farther behind and they will make more and more and more in fees.

There is a way to save your home, regain control of this nightmare, and get back in the driving seat.  Read on.


Mississippi is leading when it comes to mortgage delinquencies. In October 2011, there were more homeowners in Mississippi behind on house notes than in any other state of the union.

The Mortgage Bankers Association reported that there are 4.2 million homeowners across the nation more than 90 days late on their house note or are already in foreclosurStop foreclosuree status. Is this the indication of us being on the road to recovery that the media would us believe?

The fact is that mortgage service companies are not willing to provide modifications to help homeowners and as a result, foreclosures continue to rise. If you want to save your house, you cannot wait until the last minute, thinking a modification will come through.  Get your documents together and meet with a lawyer now that handles bankruptcy and foreclosure defense to learn what options you have available.  Get the information now  – before you need it.  Be prepared.  Plan ahead.  Think about it – what good is buying car insurance after the wreck? I continually meet with people that come in after the foreclosure sale date is set trying to figure out what they can do. In most cases we can still help and save the house, but it would have benefited the people so much more to have met with me as soon as their payments started falling behind.  Timing matters – and knowing your options is worth it’s weight in gold.  If you’re online, researching foreclosure because you’re worried about losing your home, the time is NOW to speak with someone. The most important thing is to save the home. There are options – the longer you wait, the less options there may be.

Foreclosure is the process that a mortgage company takes to repossess and sell your home when you fall behind in the payments.  In Mississippi, the mortgage company does not have to file a lawsuit against you and get an Order from the Court in order to sell your home.  In Mississippi, the mortgage company does not have to send you a letter telling you they are foreclosing and when the sale will be.  All they have to do is to run an ad in the newspaper and then auction your home.

When you fall behind on the mortgage, your mortgage company will typically send you a letter telling you that you have a thirty days or so to catch up before foreclosure proceedings start.  This is called an acceleration letter.  Once the mortgage has been accelerated, the mortgage company is no longer obligated to accept payments unless they are enough to catch up all of the past due amounts.  But this won’t be just the number of months that you think you are behind.  It will be all of the past due amounts they say you are behind, plus all of the fees and charges they have added on to your account, including foreclosure fees.

The lender must advertise the sale in the newspaper once a week for at least three weeks.  At the end of the advertising period, usually the fourth week, the foreclosure auction sale takes place on the courthouse steps.  Anyone can bid, including the mortgage company and the property goes to the highest bidder.

There is a provision of the bankruptcy law that allows Mississippi homeowners to eliminate second mortgages.   Not widely known, this section of the bankruptcy code is becoming increasingly popular to bring the mortgage debt closer to the real value of the home.

Bankruptcy law prevents a homeowner from getting rid of the first mortgage if they want to keep the home, but the rules don’t apply to second mortgages.  The second mortgage can be stripped off (canceled)  if there is no equity to cover the debt, which is the case for thousands of Mississippi homes that are worth a lot less now.

The law has been in effect for years, but during the housing boom houses were worth much more and there was not much occasion to use it.  This is only available in Chapter 13 bankruptcy.

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