Closing day on a new house is an exciting time for homeowners – most of them feel like the world is at their fingertips and they can take on anything, including the sizeable mortgage that comes with most home purchases. Sadly, over time, what seemed like a manageable mortgage payment can quickly become difficult to meet as individuals find themselves faced with other bills such as new car payments, repair costs, medical bills, and the expenses of caring for children. In today’s tumultuous times, making mortgage payments can seem even more impossible with COVID-19 ravaging the nation and changing our economy. Thankfully, there is an option that won’t ruin your credit! If you are unable to continue to meet your mortgage payments, you can pursue a mortgage modification.
What is a Mortgage Modification?
While it may feel like lenders are more than happy to send homeowners into financial ruin and bankruptcy, that’s actually not the case. Lenders want to get paid because foreclosures and wage garnishments are not only a huge hassle but also result in them spending money and thus resulting in lower returns. To help you avoid home loss and the fear of bankruptcy, many lenders offer mortgage modifications where they lower your monthly mortgage payments. This makes it possible for you to keep your home and them to keep getting paid. In a modification, they will review your current financial situation and work to make your payments smaller and more manageable, helping you to stay in your home and keep up with your current bills.
These modifications can be achieved by reducing your overall debt, lowering interest rate, increasing your mortgage term, or even postponing payments so you can get through a difficult financial time.
Why the Time is Right
With the arrival of COVID-19, many people had their work hours decreased or were laid off entirely. The economy seems on the upward swing now, but many are still relying on unemployment to pay their monthly bills. Unfortunately, the additional unemployment benefits offered through the CARES act are set to expire this month, leaving individuals with a $600 weekly deduction in their benefits. With some homeowners relying entirely on unemployment to get them through their monthly bills, this reduction may put them in a seemingly impossible situation. Before getting behind on mortgage payments, it is wise for homeowners to start taking action now while they still have time!
Additionally, Pennsylvania Gov. Tom Wolf is extending his moratorium on evictions and foreclosures through Aug. 31. However, this does not cancel the payments families will need to pay, only increases the chances for a foreclosure by a month. Meaning that families in Philadelphia County will still owe their mortgage payments as one giant lump sum, or face a foreclosure, once the new deadline is reached. By filling for a mortgage modification now families can place themselves in a better financial situation through the active lowering of their monthly payments and the proactive negotiations with their lender.
How to Get Started
If you have been barely able to meet your mortgage payments or relying on your unemployment benefits to cover them, then you shouldn’t wait to start modifying your mortgage and exploring available solutions. It is important to consult with an experienced bankruptcy lawyer to evaluate your options for mortgage modification and more financial solutions. An experienced attorney will be able to bat for you when negotiating with your lender and have the most up to date information regarding current policies and requirements. Modifications can move slowly when a lawyer is not involved. Having a lawyer by your side can move your lender to action
By pursuing a mortgage modification, Philadelphia County and Pennsylvania residents can see their monthly payments drop to a more manageable amount. Don’t wait until you are months behind on payments and facing foreclosure – get started now and work to lower your payments. Contact our team to learn more about mortgage modification and how it can help you thrive in the midst of our economic crisis.
Sadek Bankruptcy Law Offices has helped numerous families, just like yours, reduce their monthly debt payments from thousands to hundreds of dollars per month, or even cancel their debt. Contact our offices today to discover how a mortgage modification might help you and find out how to take the first steps! Together we can work to protect your home and make sure that the second half of 2020 is better than the first!