Despite an apparent uptick in consumer confidence this during the latter part of 2010, no one is buying the idea that the housing market—a major cause for this decade’s economic meltdown—is getting better anytime soon. In fact, according to U.S. Bank regulators, the country’s home foreclosures actually spiked in the third quarter as banks and other mortgage lenders became less inclined to help Americans stay in their homes as the housing market continues to struggle. While these same regulators blame the increases in foreclosures on the fact lenders have run out of modification options for keeping beleaguered (but delinquent) borrowers in their home sweet homes, the number of actual loan modifications, especially those processed through the Home Affordable Modification Program (or HAMP), the Obama administration's leading foreclosure prevention effort, don’t pan out.
According to a report from Reuters’ Dave Clark, “Newly initiated foreclosures increased to 382,000 in the third quarter, a 31.2 percent jump over the previous quarter and a 3.7 percent rise from a year ago, the Office of the Comptroller of the Currency and the Office of Thrift Supervision said in their quarterly mortgage report. The number of foreclosures in process increased to 1.2 million, a 4.5 percent increase from the second quarter and a 10.1 percent increase from a year ago, according to the regulators.
The report, which covers 33 million loans serviced by national banks and federally regulated thrifts, also shows a sharp drop in the amount of loan modifications processed through the Home Affordable Modification Program (HAMP), the Obama administration's leading foreclosure prevention effort. HAMP loan modifications fell by almost 46 percent in the third quarter, according to the report.”
And with related news that overall home retention strategies taken by banks to keep borrowers in their homes have dropped by a staggering 17 percent from one quarter to the next, many American homeowners are left wondering their next best step to keep their current shelter, amid high unemployment, falling incomes, and higher heating expenses expected throughout a new year.
Fortunately, where one federal system is failing, another is available to help fix these lingering financial woes: bankruptcy. A personal bankruptcy—in Chapter 7 or 13—helps hard-hit homeowners handle lingering credit card debt, medical costs and more, while (in a Chapter 13) allowing for all-important restructuring to keep a roof over their heads. With a Chapter 7 bankruptcy, you can find relief from foreclosure by ridding your balance sheet of unsecured debts and creating space to save for your current home or one more well-suited for your post-recessionary budget. Under Chapter 13, you can restructure your secured debts (including getting back on track with your car and mortgage payment), allowing you to hold onto your home and discharge your unsecured debts in three to five years. Chapter 13 also allows you to catch up the arrears on your mortgage or mortgages over that 5-year period while making monthly mortgage payments. In short, Chapter 13 can stop your own real estate recession in its tracks.
If you too have been affected by the economic crisis, knowing a qualified bankruptcy attorney can also help you to conquer your creditors, banks or other lenders, yielding the right kinds of support, information and insights—at a low cost— for a viable and secure future beyond the current housing crisis. The bankruptcy experts at the Law Offices of John T. Orcutt offer a totally FREE debt consultation. Just call toll free to +1-919-646-2654, or make an appointment online at www.billsbills.com. Simply click on the yellow “FREE Consultation Now” button.