Florida has the second highest rate of bankruptcies in the nation. Upwards of 94,800 filings occurred in 2011. Thankfully, that number is less today. There were a total of 15,434 bankruptcy filings in South Florida in 2017.
While the number of individuals claiming bankruptcy has decreased, the devastation it may visit upon these individuals has not. One of the most common fears, and most common results, of an individual declaring bankruptcy is that they lose possession of their home.
Thankfully, there is something called Mortgage Modification Mediation (MMM). As the largest consumer bankruptcy filing firm in Florida, we know a thing or two about using Mortgage Modification Mediation programs to help you keep your house.
Check out our guide below. Do not hesitate to contact us today so we can help you keep possession of your home.
What is Mortgage Modification Mediation (MMM)?
Mortgage Modification Mediation is a process by which homeowners can negotiate to keep their house after declaring bankruptcy. It involves a court-appointed mediator working with the individual filings bankruptcy and their attorney to come to a modified mortgage agreement.
It is important to note here that any agreement reached must be signed by the Bankruptcy Court before it becomes enforceable.
A few other MMM caveats exist. These include: the debtor having a regular income, and seeking mortgage mediation on their primary residence.
The Mortgage Modification Mediation Process
The MMM process begins when the debtor files a motion to engage in Mortgage Modification Mediation within ninety days of declaring bankruptcy. The mortgage lender then has fourteen days to contest this motion. The court will reconsider and, if they decide to allow the individual filings bankruptcy to continue MMM, will appoint a mediator.
This mediator will then work with the debtor, their foreclosure attorney, and the lenders to come to an agreement. This agreement must be reached within 150 days, unless both sides agree to an extension. The modified mortgage can take on different forms, including: lowered monthly payments, reduced interest rates, extending the length of the loan, and more.
After the individual files for bankruptcy, their attorney and the mediator come to an agreement, where the modified mortgage is brought before the Bankruptcy Court. The court can choose to approve it or not. There are other options, including filings for Chapter 13 bankruptcy, if the court does not approve the modification.
Should You File for Mortgage Modification Mediation?
There is not a single answer to this question. Rather than saying yes or no, you should ask yourself if MMM makes sense in your current situation.
First and foremost, you must meet the criteria to file for modification mediation. If you do meet the criteria, then it is wise to consider whether you will be able to make modified payments. If you have declared bankruptcy because you have lost your job or source of income, for example, it may not make sense to apply for MMM. If, on the other hand, you have experienced temporary hardship but still have a source of income, then it may make sense to file for MMM.
Again, the answer will largely depend on your individual situation. If you would like a personalized review of your options, call us today at 305-445-4855 for a free consultation. We will review your situation and offer smart, actionable advice.