This is the common reoccurring theme that our law firm has experienced since early 2007 when we first started performing loan modification for our clients. If this was easy then we wouldn’t have so many foreclosures and everyone would be getting the help they deserve.

But you and I know that simply is not true.

Mortgage servicers do not have the manpower to handle the volume of delinquent borrowers and thousands of homeowners are simply getting lost in the mayhem. For some of you, hiring an experienced loan modification attorney that can cut through the red tape can be crucial and may make the difference in saving your home.

Maybe the reason you need a lawyer is because you have multiple properties, complex financial situations, do not have the time to do this on your own or have been turned down by your lender. If you want to save your home, walk away or simply be legally protected during the foreclosure process, then you need a lawyer.

If you are someone like in this CNN article below and you are not getting help from lender,  please give us a call at (888) 756-2652.

From CNN:

Borrowers and housing counselors, however, have been complaining about the program since it began. Many say their servicers are not responsive — losing paperwork, not returning calls and never making decisions on applications. Some charge that servicers are violating the rules, such as denying modifications to those who are still current with payments.

We recieve calls to our firm every day from homeowners who have tried to reach out for help under these plans and should qualify, but they are denied or turned away. In frustration, they have to hire an attorney to fight for them and their home.

Yes, the bill is definitely a ray of hope for some borrowers, but it is unlikely to stop or delay most foreclosures.

Though many lenders already have federal incentives to offer loan modifications, this new law will help delay foreclosure on some owner occupied residences, but who is watching and regulating? It seems that mortgage servicers left to their own device aren’t practicing what they preach.

According to the new law, lenders must prove that they tried to modify the delinquent loans before they can go ahead and begin foreclosing on them. If the bank does not find a resolution as to modifying the loan, the homeowner will still have 90 days until the bank can take their house. During this time, it should hopefully give homeowners a chance to figure out other options on their own.
 
But many people believe that the California Prevention Act will not be able to stop thousands of foreclosures from eventually happening, but it is one step towards a more systematic review of delinquent mortgages.
 
If you are one of thousands of homeowners facing foreclosure in California and feel like their is just no hope, please give the Fransen and Molinaro Law Firm a call at (888) 756-2652 today for a free consultation.

Often, homeowners find our law firm after they have attempted to obtain a loan modification on their own and or were unsuccessful in working with a non-profit. If this is you, the Fransen and Molinaro Law Firm is the perfect solution to help you make your case with your mortgage servicer.

OK, back to the lesson…..

When you are first applying for a loan modification, make sure that you have a game plan on how exactly you are going to approach your lender. Their reps are trained in minimizing loss for their company, and they get paid by getting the most amount of money out of you as possible. This is how mortgage servicers mitigate loss, everything can and will be used against you.
 
Lenders may lower the interest rate, change adjustable-rate loans to fixed-rate terms, or even extend the term of a loan. In some cases they may even increase the principal balance of your loan by adding delinquent amounts to the back. But if you are just looking to knock your $600,000 mortgage down to $450,000 because that is all your home is worth, it probably is not going to happen.
 
Determining if you can afford your home and just not the loan is key. If you have no source of income at this time then you need to request from your lender a forbearance agreement before attempting a modification. A forbearance agreement may allow you up to 3-6 months of no payments. But not always will they approve you for one and they may end up suggesting you short sale the property.
 
You need to also determine where you are in the foreclosure process. Are you only a week away from a notice of trustee’s sale or have you missed only one payment at this time? You will need to quickly determine how much time you have to process your paperwork. It can easily take anywhere form 30 to 90 days.
 
Determining Factors your Mortgage Servicer is Looking for:
 
 Nature of Hardship Causing Mortgage Problems
Ability to pay
Amount Owed
Equity in the property
Future financial situation

What is better for them? To foreclose or pursue a loan workout with you and or modify your loan. Meaning which approach will best benefit the lender in the long run.
 
If during the modification process it seems financial future looks bleak for the homeowner, or it doesn’t seem they would be able to afford even with the new terms, then they will most likely be denied for a workout solution.

Since our country is in such a serious mortgage crisis, you would think that lenders are now willing to negotiate when borrowers are facing financial difficulties, but that is simply not true. The facts are that thousands of people are not getting the mortgage assistance they need when the reach out to their lender and cannot afford their monthly payments. Thousands of homeowners are having problems trying to accomplish modifications on their own and just can’t seem to make it work.

If this is you, please call our law firm for a free consultation and we will give you an honest opinion on what we can do to help. (888) 756-2652

It is crucial that if you are facing these hardships that you get serious help from a foreclosure attorney and try to stop the foreclosure process from taking place as soon as possible. No matter how far behind you are on your mortgage payments, the debt situation can still be possibly be hopeful and recoverable from foreclosure.

This is a legal situation and you may be facing several negative implications down the road if you do not properly protect your best interests. You may have questions about deficiency judgements, possible wage garnishments or what will happen if you just walk away.
 
Even though hiring an attorney may cost some money, it may be the difference between losing your home, keeping it and protecting your future income and credit. More importantly we can help you explore all of your options throughout the California foreclosure process. Options such as negoitating a possible loan modification, short sale, deed in lieu, and try to just tie up all the loose ends.

What most consumers don’t know is that section 2945 of the California Civil Code requires “foreclosure consultants”, that is, people who do loan modifications, to be A. Attorneys or B. registered with the Department of Real Estate before an advance fees can be accepted. Section 2945 also states that even if registered, a loan modification company cannot accept advance fees after a Notice of Default has been served.

Even the Federal Trade Commission is cracking down on fraud and deception by mortgage modification and home foreclosure rescue companies. The FTC is seeking to halt the proliferation of these mortgage relief scams – which target distressed and vulnerable consumers who are delinquent or facing foreclosure – through increased law enforcement, consumer outreach, and close coordination with federal, state, and non-profit partners.

“As long as servicers profit because homeowners are in default, they’re not going to volunteer to take a hit,” Alys Cohen, an attorney with the National Consumer Law Center, testified Thursday.

Read more from the Washington Post

There may come a time when you will suddenly realize that it has become difficult if not impossible to make the required payments for the home mortgage. A deed in lieu of fotreclosure may be your ticket to exit safely and a good California real estate attorneys is just wht you need.

If this is your situation, then you might be facing the possibility of a foreclosure. You lose your home and some of your self-respect, and you discover later that it is much more difficult for you to take out a loan.

Don’t despair because the Law Offices of Fransen & Molinaro, LLP may be just what you need to lend you a helping hand because one of their primary areas of expertise is mortgage law and predatory lending.

But first, why don’t you have some quiet time with yourself and ask yourself a couple of questions?

The threat of a foreclosure may be so frightening that the fear could prevent you from making a wise decision or it could spur you into making a move that you will later regret. Many people just want to walk away and give the keys back to the bank. That is perfectly fine, but make sure you are educated about the “legal” risks that you may face because of that decision.

Here’s a secret that you might find interesting: your lender is just as reluctant as you to go ahead with the foreclosure.

Why would he want to pay for legal expenses that could average $10,000 per month? Why would he want to lose the monthly income during the time interval when it is foreclosed and when it is sold? 

So, calm yourself a bit and look at your situation from the point of view of another person who is not worried about foreclosure. Ask yourself (or this imaginary person) if the current incapacity to pay is permanent or temporary. If your financial situation is temporary, then why don’t you workout a solution with the lender?

If it is permanent, then you might have to give up your home but you must try to protect yourself from being liable beyond what the lender could get when he sells the property.

If Your Situation Is Temporary, You Might Get to Keep Your Home

A possible alternative here is loan modification, where the current agreement with the lender is renegotiated for an adjustment in the interest rate, especially for adjustable-rate mortgages (ARMs) and the teaser rate is no longer in force.

The teaser rate is lower than prevalent rates so that the lender would, of course, want to increase the rate. However, in this alternative, you are depending on the principle that the lender might find it more appealing to permit you to continue to pay the teaser price for a longer length of time instead of getting zero monthly payments with you out of the house.

If You Have to Leave Your Home, Do So without Fear

If you have been honest with yourself and found that the situation is permanent, there is no choice but to hand over the keys to your home. But it is not as simple as that. In some states, your liability as debtor will not be totally erased if the house sells for less than the unpaid amount. The lender might force you to make up for the difference! So, how do you protect yourself from this possibility?

An option that you might consider is the short sale, where it is possible for the lender to free you from being responsible for any deficiency in the amount collected from the sale.

But wait!

A potential problem here is that there must be a willing buyer and the lender must agree to the proposed price. The challenge here is looking for the buyer who would be able to offer an amount that is not too low that the lender would not be interested. 

Another option is the deed in lieu of foreclosure, which simply means that you just hand over the keys of your home to the lender and in return he forgives and forgets any difference in the amount you had not paid and the money he would get from selling it. Just make sure that the agreement is in writing and, of course, having a lawyer to guide you in the process would be better. 

It is important to remember with the short sale and the deed in lieu of foreclosure that they are quite complex in their requirements. One critical requirement here is that you must be able to prove to the lender that you are no longer capable of keeping up with the payments but that you were indeed capable during that time that you took out the loan.

So far, two months after the program went into effect, about 55,000 homeowners have been extended loan modification offers, according to a senior administration official. At the same time, foreclosures continue apace. RealtyTrac reported Wednesday that foreclosure filings reached 342,000 last month, up 32 percent from April 2008. Moody’s has estimated that more than 2.1 million homeowners will lose their homes this year.

Because of the size and complexity of the modification program, the administration has only recently assembled most of the pieces. In late April, officials fleshed out their plan to modify or forgive second mortgages — one of the big stumbling blocks in modifying primary mortgages — and provided more details on the Hope for Homeowners program, for borrowers who owe more than their homes are worth. Congress is close to acting on legislation to protect mortgage servicers from potential lawsuits from investors, while also expanding the Federal Housing Administration’s ability to modify loans.

Read more from the Times