What to Look For in a Foreclosure Law Firm

How Ramon benefitted from speaking with a foreclosure defense law firm

Ramon came to me at 87 years old. He had lived in his home for over 40 years and still owed mortgage payments.

One day his pension benefit check stopped arriving. He didn’t have any way to make his mortgage payment. For six months his mortgage went unpaid.

All he was left with was his SSI check. But without his pension income, he was unable to afford both the mortgage payments and his living expenses.

He understood that his income was too low to save the home long-term, even with a loan modification. His plan was to eventually sell the home and move in with his son but he needed to stay in the home for nine months before he could move.

With the nine month goal in mind, we built Ramon a tailored plan:

• We applied for a loan modification even though we knew it wouldn’t be approved. That allowed us to secure a “loss mitigation hold” on the foreclosure activity on the file while the review was ongoing
• Following the loan modification denial, we used the appeal process to buy additional time. We appealed the denial (knowing the appeal would be denied) and earned another 30-day loss mitigation hold while the appeal was reviewed.
• Eventually, Ramon received his Notice of Default. That allowed us to file for Mediation.  Filing for mediation immediately stops the foreclosure process. We then used the mediation process to get his lender to agree to give us a 120-day hold on the recording of the final foreclosure notice.

At this point, we had secured an extra 6 months in the home. After the expiration of the foreclosure hold, the bank filed their final foreclosure notice, the Notice of Trustee Sale. That gave Ramon an additional 4 months before the home was set to be sold at auction.

At the end of the 2nd month before his auction date we put the home on the market. At this point we were 8 months into the 9 month plan. The house sold and closed quickly. Ramon was then able to move in with his son as planned. He received cash from the sale of the home and he avoided foreclosure.

The plan was a success. We got him the 9 months he needed to be able to peacefully transition out of the home.

Without a foreclosure law firm or a foreclosure defense attorney, Ramon might not have known how to use all the processes available to him to get the most time possible in the property.

What is a foreclosure law firm?

A foreclosure law firm, more commonly known as a foreclosure defense law firm, can:

• Help you understand the government programs that may assist you with foreclosure prevention
• Counsel you about your situation to determine whether the loan modification process can help you keep your home and stop foreclosure
• Counsel you about other types of loss mitigation options that may help you stop foreclosure
• Help you understand how foreclosure laws may protect you
• Help you understand whether bankruptcy is the right option to help you stop foreclosure
• Help you understand whether you are facing a judicial foreclosure or a non-judicial foreclosure.
• Help you understand the timeline of your foreclosure process and how much time you have
• Help you build a tailored plan for your particular situation

A foreclosure law firm should be able to help you with all the services below:

• Loan Modification: A loan modification is a new loan with new terms that allows you to resume mortgage payments without having to pay everything you owe all at once. Usually, your missed mortgage payments get added to your total principal balance and become due at the maturity date of the loan. It is common for loan modifications to offer reductions in interest rates, extended maturity dates, and sometimes – they lower the monthly mortgage payments.

• Repayment Plan: A repayment plan is an agreement that allows you to resume your regular mortgage payment and pay an extra amount on top of your mortgage payment until you’ve paid back all your missed payments. Once you have paid everything back, you continue making your regular monthly mortgage payment.

• Forbearance: A forbearance gives you a temporary break in having to pay your mortgage. Once approved for a forbearance, you are allowed to stop payments for the approved months without the lender taking foreclosure action against you.

• COVID-19 Deferral Agreement: For those of you who were placed on a COVID-19 Forbearance plan (and have Fannie Mae or Freddie Mac as your investor), you may be able to receive a deferral agreement which takes the amount of payments you missed during your forbearance and defers the amount owed to the maturity date of your loan so you can just resume your regular payment.

• Partial Claim COVID Transition Option: For those of you who were placed on a COVID-19 Forbearance plan (and have FHA as your investor), you may be able to receive a partial claim agreement which takes the amount of payments you missed during your forbearance and defers the amount owed to the maturity date of your loan so you can just resume your regular payment.

• Short Sale: A short sale allows you to sell an underwater property for less than what is owed on the mortgage. Your mortgage lender approves the sale and then typically waives the deficiency balance (the remaining amount owed) so you can sell your home and move on without owing the remaining balance.

• Deed in Lieu: A deed in lieu is an agreement between yourself and your mortgage lender where you sign a document giving the house back to the bank in exchange for the bank agreeing not to foreclose on you.

• Reinstatement Support: If you’re behind on payments and want to pay everything back that you owe at one time, this is called a reinstatement. The process can be complicated as there can be many different parties involved.

If you’re a Washington state homeowner and would like to speak with a foreclosure law firm, feel free to give me a call at (425) 654-1674.