Reader's Question:
I am four months behind on my mortgage payments. I was thinking about filing for bankruptcy so that I can keep my home. What results have you seen and is bankruptcy effective?
Christian's Response:
Reader, Although I am not an attorney I have decided to respond to this email post regardless as I feel it is a valid question that many may ponder. With that said, I do not want you to feel that I am giving any legal advice, rather posting my own thoughts and professional experience as a loss mitigator specializing in lender mitigation and as a licensed Real Estate Broker in California. I will go ahead and brief you with this much information:
The bankruptcy hurts you, not the bank. Truthfully, the banks can care less. I personally know banking executives (professionally known as "asset managers") that laugh when they see a homeowner file a BK. I know of one locally in Pasadena that gets a thrill out of it. It really excites him. Yes, it will delay or postpone the foreclosure process (at best) but that‟s where it stops.
I am four months behind on my mortgage payments. I was thinking about filing for bankruptcy so that I can keep my home. What results have you seen and is bankruptcy effective?
Christian's Response:
Reader, Although I am not an attorney I have decided to respond to this email post regardless as I feel it is a valid question that many may ponder. With that said, I do not want you to feel that I am giving any legal advice, rather posting my own thoughts and professional experience as a loss mitigator specializing in lender mitigation and as a licensed Real Estate Broker in California. I will go ahead and brief you with this much information:
The bankruptcy hurts you, not the bank. Truthfully, the banks can care less. I personally know banking executives (professionally known as "asset managers") that laugh when they see a homeowner file a BK. I know of one locally in Pasadena that gets a thrill out of it. It really excites him. Yes, it will delay or postpone the foreclosure process (at best) but that‟s where it stops.
Bankruptcy will not indefinitely allow you to keep your home nor does it "wipe away" your mortgage obligation. Bankers have learned how to get around BK filings. They simply file a "relief from stay" and eventually what usually happens is you‟ve hurt yourself and your credit report for 7-10 years and the lenders most likely prevail at the end of the day. Obviously, a short sale is not an option for you since you stated you intend to keep your home.
Might I suggest that if you were going to spend 2 - 4 thousand dollars on a bankruptcy proceeding as the sole purpose for retaining your home, you might want to seek out an attorney that can prepare a loan modification request for you? Speak to friends and family. Most definitely get a referral. There are many loan modification companies out there today that claim to be loan modification "experts", but truthfully they are 'fly by night'. Here today, gone tomorrow. Ask for copies of their lender approvals. If you need further assistance or you feel lost, email us back. We‟ll point you in the right direction and give you a few phone numbers of legitimate law firms that do quality and legitimate loan modification work. Thank you for emailing and thank you for doing the best you can in order to keep your home.
