In addition to helping members of the Colorado community with bankruptcy issues, Weselis & Suchoparek LLC also helps individuals understand the Colorado foreclosure process and keep your residence, if you wish.
If you have received a notice of foreclosure proceedings and are unsure of what to do, please call our office to speak with an attorney today. The Colorado Foreclosure laws have recently changed and we may be able save your house if you contact us immediately. Once your house goes into foreclosure, time is of the essence if you wish to keep your house.
Below you will find a brief summary of some of the options available to you:
Strip off Your Second Mortgage
In some circumstances, you can get rid of your second mortgage or your Home Equity Line of Credit (HELOC) by filing bankruptcy, which will help you make smaller payments on the house in the future by only being responsible for making your first mortgage payment. Although the decline of your property value in today’s real estate market is a bad thing, it actually can be a good thing for purposes of wiping away your second and third mortgages in Bankruptcy. The time to act is now because once the property values begin to rise again, it will be too late. Thousands of homeowners are not just modifying their mortgages, but getting rid of them free and clear and you do not want to be the neighbor that is paying hundreds more on the same house per month. This is one of the benefits of the new bankruptcy law that a highly trained Colorado bankruptcy attorney can help you with. Not every state has this option so give us a call before the law and markets change and we can see if this is an option for you.
Loan modifications are constantly in the news and some people are having success in restructuring their loan. However, please keep in mind that just because your mortgage lender calls it a modification, it does not necessarily mean it is your best option. While it is true that President Obama enacted certain programs to help homeowners afford their monthly mortgage payments, we understand that it is a frustrating process for everyone to go through.
Your mortgage lender always seems to loose your paperwork, promise you one thing and then tells you something completely different–Does this sound familiar? This is why we as Colorado Bankruptcy Attorneys are obtaining the most success for our clients in many cases with a combination of modifying their first mortgage and getting completely rid of their second mortgage through Colorado bankruptcies (See Above). In addition, once you are under bankruptcy protection, we hold the lenders “feet to the fire” to ensure you are obtaining the best modification possible under your circumstances. We as Colorado Modification and Foreclosure Attorneys have a special “portal” established with the banks to in essence fast track the modification process.
While not everyone qualifies for a Colorado loan modification, we try diligently to help those that do. A Colorado loan modification makes sense in a situation where a homeowner has experienced a decline in income and can no longer afford the original loan but could afford the payments with a little adjustment. Examples of loan modifications include lowering the interest rate, extending the loan period, or adding the delinquent portion and fees back onto the principal of the loan to be repaid overtime.
Please call our office today as this is an ever changing area of the law and with the aid of a bankruptcy we are experiencing better results for our clients.
A Repayment plan
Oftentimes, a repayment plan is better suited to a homeowner who has had a short-term financial hardship but is now getting back on their feet. Although a homeowner is recovering, they may be several months (and thus several thousand dollars) behind on their mortgage payments and they need time to bring this amount current. Once a Colorado foreclosure has been initiated, a lender often will not accept any further payments less than the entire delinquent amount (this is so that they do not jeopardize their rights under the current Colorado foreclosure proceedings). A repayment plan requests that the lender stop the Colorado foreclosure process and structure a repayment schedule in a more lenient fashion to allow the recovering homeowner time to catch up on their loan and save their home.
Despite this, most times filing a chapter 13 bankruptcy is a much better option. The reason is that when the lender places what you were behind on to the back of your loan, the whole amount accrues interest and penalties over the life of your loan. Thus, a 10K balance many easily become a total of 40K when you finally pay it off. In a Chapter 13 Bankruptcy, you have up to five years to pay only the amount that you are behind on from the date of filing your case. This often a much more economical option in the long run.
A forbearance is a request that the lender stop proceeding any further with the Colorado foreclosure for a short period of time. This is usually done in conjunction with other relief efforts. For example, a lender would issue a forbearance while the homeowner tried to sell their home to cure the debt via a short sale.
In 99% of client situations, we DO NOT recommend a “short sale” despite what every Realtor is telling you. This is because a short sale kills your credit more than any bankruptcy filing in most cases. The Realtors are using your dire financial situation to earn a commission for the sale of your house. However, what the Realtor is not going to tell you is that you will soon realize is whatever is left on the loans that was not paid off in the short sale you will be sued for in Colorado. In addition, you may also be taxed on the difference. Therefore, not only will a short sale ruin your credit, but you may also find yourself in large amounts of debt because of the short sale. You just went through the frustrating process of finding a buyer for the lender and the only two parties who make out is the Realtor with their commission and the lender because you did the hard work and found them a buyer. Unfortunately, you get nothing in most cases. If you insist on doing a short sale demand from your Realtor that the lenders on all loans provide you in writing they will not collect the deficiency from you in the future. In most cases they are unwilling to do this and that is why filing a bankruptcy to get out from your loan obligations is usually a sounder financial decision.
Deed in Lieu
Under a “deed in lieu” workout, a homeowner surrenders their property to the lender in exchange for the lender not to foreclosure on their mortgage. The borrower also avoids the public notoriety of a Colorado foreclosure proceeding and may receive more generous terms than he would in a formal foreclosure in Colorado. However, please keep in mind that if there is a second mortgage on the home, you will be held liable and likely sued for the balance. Many people do not realize this and this is why surrendering the property though a bankruptcy proceeding in most cases is the best option.