Foreclosure · Mortgage Modifications
We Can Help With Mortgage Modifications and Foreclosures
Filing bankruptcy stops the foreclosure process and gives you the chance to pay back arrears under a single court-supervised plan. We know how to make banks negotiate.
Our clients are often surprised to find out how much more helpful bankruptcy laws are than they first realized. One of the few real advantages in filing is that it can stop the foreclosure process and give the debtor a chance to pay back arrears little by little. A Chapter 13 plan typically lasts three to five years and can fold in any unpaid property taxes, association arrearages, equity loans, second mortgages, and lines of credit.
The Double Benefit of Filing Chapter 13
Our clients are relieved to learn that filing Chapter 13 lets them save their home and eliminate most or all of their credit-card debt. There is a double benefit: save your home and resolve your credit-card debt in one move. After filing, you have a single monthly payment to the Chapter 13 trustee instead of dozens of creditors calling you.
Patrick Cordero personally understands that no one wins when your home is foreclosed on: not the bank, not the real-estate market, and certainly not you. In today's tough economic environment, the goal is to keep you in your home. There are options to avoid foreclosure, reduce monthly payments, defer debt, or lock in a better interest rate, and we know which ones apply to your situation.
How a Loan Modification Works
A loan modification permanently changes the terms of your existing mortgage so the monthly payment becomes affordable. Depending on your lender and the investor that owns your loan, a modification can lower your interest rate, extend the repayment term, or add your missed payments to the loan balance so you are no longer behind. Unlike a refinance, a modification does not replace your loan with a new one.
Modification files at our firm are coordinated by attorney Stephen Cordero, our modification coordinator. Here is what the process typically looks like:
- Gather your documents. Servicers typically ask for proof of income, recent bank statements, tax returns, a hardship letter explaining what changed, and a monthly budget of your income and expenses.
- Submit a complete application. A complete loss mitigation application is what counts. Under federal mortgage servicing rules, submitting one early enough can restrict the servicer from moving forward with foreclosure while it is reviewed.
- Respond to every request quickly. Servicers often ask for updated or missing documents. Delays can leave the application incomplete and cost you those protections.
- Complete any trial period. Many modifications start with a trial plan of adjusted payments. Making every trial payment on time is usually required before the modification becomes permanent.
- Review the final agreement. Before you sign, we review the new rate, term, balance, and any deferred amounts so you know exactly what you are agreeing to.
Let Us Help You Keep Your Home
We offer a hands-on approach that keeps clients informed and involved at every step. Take advantage of our free initial consultation to sit down with an attorney, have your situation evaluated, and find out how we can put more than three decades of bankruptcy and foreclosure-defense experience to work for you. We also assist Spanish-speaking clients.
Avoiding Foreclosure: Why Speed Matters
Our bankruptcy attorneys have spent more than three decades helping thousands of South Florida clients of all incomes and walks of life. If you have been served with notice of foreclosure, swift action is critical, because every day matters. Many lenders are willing to work with you, but the best options are available before the foreclosure case advances.
Don't choose to give up the monetary and personal investment you have put into your home without exploring every option. Foreclosure is slow and expensive for lenders too, so in many cases restructuring your loan through a mortgage modification makes more financial sense for them than taking the property back. We know how to make that case and negotiate the terms.
Modification, Chapter 13, or Short Sale: Which Fits Your Situation?
In Florida, every foreclosure is a lawsuit: the lender must sue in circuit court, and a homeowner who is served generally has 20 days to respond. The right strategy depends on whether you want to keep the home, what you can afford going forward, and how far the case has gone.
- Loan modification. Best when you want to keep the home and your income can support an adjusted payment. It changes the loan itself and does not involve bankruptcy court, but the lender has to agree to it.
- Chapter 13 bankruptcy. Filing triggers the automatic stay, which stops a foreclosure sale if you file before the sale takes place. A Chapter 13 plan then lets you cure the arrears over three to five years while you keep up with your regular payments, even if the lender will not agree to a modification.
- Short sale. Best when keeping the home is no longer realistic. A short sale lets you sell for less than you owe with approval from the lender, and negotiating a waiver of the remaining balance is a key part of the deal.
- Responding to the lawsuit. Filing a timely response and raising any valid defenses keeps you in the case and protects your options while other solutions are pursued. See every foreclosure defense option we offer.
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Common Questions
Loan Modification and Foreclosure Questions, Answered
What is a mortgage loan modification?
A loan modification is a permanent change to the terms of your existing mortgage, agreed to by your lender, that makes the monthly payment affordable. It can lower the interest rate, extend the term, or add missed payments to the balance so the loan is brought current. Unlike a refinance, it does not replace your loan with a new one.
Does applying for a loan modification stop a foreclosure in Florida?
Not automatically. Under federal mortgage servicing rules, a complete application submitted early enough can restrict the servicer from moving forward with the foreclosure while it is being reviewed. An incomplete or late application may not get that protection, which is why timing and completeness matter so much.
How long do I have to respond to a foreclosure lawsuit in Florida?
A homeowner served with a foreclosure summons generally has 20 days to file a response with the court. Ignoring the summons can lead to a default judgment, which moves the case toward a final judgment and a foreclosure sale. Talking to your lender about a modification does not, by itself, pause that deadline.
What documents do I need to apply for a modification?
Most servicers ask for proof of income, such as recent pay stubs or profit and loss statements, recent bank statements, tax returns, a hardship letter, and a list of your monthly expenses. Exact requirements vary by servicer and by the investor that owns the loan. We help you put together a complete package so the application is not delayed.
Will a loan modification reduce what I owe?
Usually not. Most modifications lower the monthly payment by changing the interest rate or the length of the loan, and missed payments are often added to the balance. Some programs set part of the balance aside to be paid later, but outright principal forgiveness is uncommon.
What happens if my modification is denied?
A denial is not the end of the road. Ask the servicer for the reason in writing, because some denials can be appealed or fixed with a new application if your situation has changed. If a foreclosure sale is approaching, filing Chapter 13 before the sale stops it and lets you catch up on the arrears over three to five years.
Can I pursue a modification and Chapter 13 at the same time?
Yes. Filing Chapter 13 does not prevent a lender from approving a modification, and many homeowners use the automatic stay to protect the home while a modification is reviewed. If a modification is approved during the case, it generally needs court approval, and the plan is adjusted to the new payment.
Schedule a Free Consultation
Call us today at 305-267-3376 or contact us online to schedule your appointment. We will sit down with you, evaluate your situation, and tell you honestly what your best path is.
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