Consumer Bankruptcy News Reports on Foreclosure Crisis
The foreclosure crisis was supposed to end with help from the federal government. Consumer Bankruptcy News reports in the May 6, 2010 issue that the response of the federal government to the mortgage crisis is too slow. The article reports that is has “been more than one year since President Obama announced the establishment of the Making Home Affordable initiative that included the Home Affordable Modification Plan.” The plan was supposed to help between 7 and 9 million families restructure their mortgages and save their homes from foreclosure by the mortgage companies. The article goes on to report that “the actual number of homeowners who have received final, five-year loan modifications through the program administered by the U.S. Department of the Treasury stands at 168,708.
The Congressional Oversight Panel’s April 2010 report entitled, Evaluating Progress of Tarp Foreclosure Mitigation Programs, “finds that Treasury is still struggling to get its foreclosure programs off the ground even as the crisis continues unabated.” The report also states that in 2009, 2.8 million homeowners received a foreclosure notice,and one in four homeowners with a mortgage currently has negative equity. While housing prices have begun to stabilize in many regions, home values in several metropolitan areas continue to fall sharply.”
I have personally witnessed in my Dallas, Rome, Cartersville and Dalton Georgia office locations that consumers are not getting the promised federal help they need to stop the foreclosure of their homes. While I have seen a few loan modifications approved even after my clients have filed Chapter 13, most loan modification applications have been denied. I have been shocked how many mortgage companies are aggressively pursuing foreclosure in this dreadful market.
The good news is that Chapter 13 stops foreclosure. In a Chapter 13 bankruptcy, we can eliminate credit card debt and medical debt. As a result, most consumers find it much easier to make their future mortgage payments when they no longer have worry about their past due credit card debts and medical debts.