Atlanta Bankruptcy Attorney Blog

As kids, we're taught that it's wrong to walk away from our problems. But as adults, many of us are doing just that by walking away from our mortgages.

Years of falling real estate prices have resulted in a large number of underwater homeowners - borrowers who are locked into a loan for more than what their home is now worth.

Those most negatively affected are young people who bought at the peak of the market and older adults who had been hoping to downsize in retirement. Hard economic times make the high payments a stretch, yet homeowners can't sell their homes without handing over a fat check to the lender.

In a situation they seemingly can't win, many are simply calling it quits. In a move termed "strategic default," they're ceasing mortgage payments and sending their house keys back to the bank.

Unfortunately, Atlanta bankruptcy attorneys have seen many clients suffer credit setbacks and even litigation as a result of defaulting on home payments. Many of these homeowners could have saved money, stress, and their home with an Atlanta bankruptcy filing.

According to MSNBC.com, walking away is easier than ever because modern homeowners feel little connection to their lenders. And it's not entirely our fault.

Many folks receive their original loan from a large national bank. Afterward, the loan may be broken up and sold to multiple anonymous investors. Often times, people seeking a loan modification aren't able to track down who currently owns their mortgage. No wonder the process feels so impersonal.

But it becomes personal when you walk away.

Defaulting on mortgage payments can drastically drop your credit score, making it difficult to find a rental, qualify for credit, and get approved for affordable interest rates. To make matters worse, lenders are beginning to aggressively seek court-ordered repayments for homeowners who walk away.

Before you make a life-changing decision like defaulting on your mortgage, make sure to consider how it will affect you down the road. Sure, giving up those mortgage payments might lighten the load today. But you're still going to have to pay rent in the future. If you ever want to buy another home, a history of default isn't going to do you any favors. And if you have other debts to deal with - like credit card debt - they aren't going to go away on their own.

Bankruptcy has the potential to improve your financial situation so that you can better handle those mortgage payments. Chapter 13 bankruptcy can protect your home from foreclosure - no matter how many mortgage payments you've missed - and reorganize your unsecured debts into more manageable payments. If you qualify for Chapter 7 bankruptcy, it's possible to wipe out unsecured debts entirely.

Continue reading "Chapter 13 Bankruptcy an Option for Atlanta Residents Considering a Strategic Default" »

Lenders can't seem to make up their minds. One day they're handing out subprime mortgages like candy. The next, it seems you need to be a saint to qualify for a loan.

Well, maybe not a saint. But you do need to have a credit score and finances that put you in the top third of borrowers, say Atlanta bankruptcy attorneys. That's right, statistics show that just one out of every three people who apply for a mortgage this season will be approved, according to Wallet Pop. Banks learned the hard way that lending to those of us with not-so-stellar credit can lead to defaults and foreclosures. Today, they're not taking any chances. But there are steps you can take to improve your own chances.

Continue reading "Atlanta Homebuyers Learn Secret to Qualifying For a Mortgage Amid Tightening Credit " »

Have adjustable-rate mortgages gotten a makeover? Lenders say the ARMs that once contributed to the housing market crash may now be an affordable option for Atlanta home buyers.

Back in the 90s, adjustable-rate mortgages made up the large majority of home loans. The problem was, many of these loans came with risky perks intended to lure borrowers - whether or not borrowers could afford them.

Some ARMs allowed for homeowners to defer making their full interest payments, leaving them with an unmanageable balance later on. Others adjusted to new, usually higher, rates every six months. Understandably, many people ended up defaulting on loans, kicking off a wave of foreclosures. By 2009, adjustable rates made up just 2 percent of all home loans. Now, they're on the rise again.

Continue reading "Atlanta Borrowers Taking Out Adjustable Rate Mortgages Again" »

For many underwater homeowners, getting a foreclosure notice in the mail might seem like the end of a long fight. But it's not over until the fat lady sings - or in this case, the judge.

Bankruptcy provides homeowners with a last chance to avoid foreclosure by getting non-mortgage debts under control. As soon as you file your paperwork, bankruptcy stops the foreclosure process while your Atlanta bankruptcy attorney and your bankruptcy judge work out an agreement with your lenders. Most at-risk homeowners ignore bankruptcy because they fear it won't work - or that it will hurt their credit. But according to a recent article on MSNBC.com, it can actually be a blessing in disguise.

Continue reading "For Atlanta Homeowners, Bankruptcy Can Be Last Chance to Stop Foreclosure" »

FHA loans were designed to make housing possible for more Americans. So what happens when they become more expensive?

Borrowers will soon find out, say Atlanta bankruptcy attorneys. The Federal Housing Administration recently announced plans to hike premiums for the government-insured loans by one quarter of a percent. It might not sound like much, but the increase comes just months after FHA raised its down payment requirement from 5 to 10 percent and added a minimum credit score of 500. It all adds up to make an affordable loan just out of reach for some homebuyers.

Continue reading "FHA Loans About to Get More Expensive For Atlanta Borrowers" »

The first thing consumers want to know when considering bankruptcy is, "How will filing affect my credit score?" Yet maybe what we should be asking is, "How will not filing affect my credit score?" Especially when we're at risk for foreclosure.

It's no news that bankruptcy ends up on your credit report, but so does foreclosure. And while bankruptcy can pave the way for you to begin repairing your credit (in fact, Atlanta bankruptcy attorneys report that many clients receive offers for credit cards or loans soon after filing) turning your home over to the bank doesn't quite have the same effect.

Continue reading "Effect of Foreclosure on Credit Scores of Atlanta Homeowners" »

It looks like Uncle Sam might be learning from his mistakes when it comes to helping struggling homeowners, say Atlanta bankruptcy attorneys.

With the Home Affordable Modification Plan enacted during the recession a seemingly multi-billion dollar flop, the federal government may be turning to a method that's actually been proven to work - bankruptcy. In a bill proposed by Sen. Sheldon Whitehouse, bankruptcy is being explored as an alternative for homeowners in need of modified mortgage terms. And with U.S. foreclosures expected to surpass 12 million next year, it couldn't come too soon.

Continue reading "Senator Suggests Bankruptcy As A Better Alternative To Mortgage Modification" »

Why should homeowners in Atlanta care about a foreclosure in Massachusetts?

Because a recent court ruling there could have a drastic impact on foreclosures in the future, affecting the entire U.S. banking industry - and millions of Americans currently at risk of losing their homes, say Atlanta bankruptcy attorneys. Last week the highest court in Massachusetts reversed foreclosures on two residences because the banks could not prove they held the mortgages at the time they seized the homes. Experts say the decision could set a precedence for increased consumer protection.

But that doesn't necessarily spell good news for homeowners facing foreclosure.

Continue reading "Court Ruling Could Affect Foreclosure Process for Atlanta Homeowners" »

Hoping for a lower house payment but not sure if you qualify for a refinance? You've still got options, say Atlanta bankruptcy attorneys.

With interest rates still relatively low, many homeowners are trying to refinance for a better payment and terms. Unfortunately, not many actually succeed. Not only is the process of refinancing expensive and time-consuming, it's also increasingly exclusive. Thanks to tightening credit requirements, it's almost impossible to qualify for a refinance without a good credit history and a well-paying job. But that doesn't mean you have to keep struggling to make your current mortgage payment.

Continue reading "How Atlanta Homeowners Can Lower House Payments Without Refinancing" »

Freddie Mac is feeling more Santa than Scrooge this season - if for only a brief period of time.

For the third year in a row, the government-backed mortgage giant plans to stop foreclosure evictions between Dec. 20 and Jan. 4. It's good news for seriously delinquent homeowners who might have otherwise lost the roof over their head during the holiday. Unfortunately, say Atlanta bankruptcy attorneys, it won't do anything to stop folks from losing their homes after the start of the New Year.

Continue reading "Foreclosures Stop Temporarily for Atlanta Homeowners " »

They say home is where the heart is - maybe it's time to put our money there, too. At least, that's the theory behind Small Business Saturday.

Never mind that the campaign, which starts today, is backed by credit giant American Express - who happens to be offering an incentive in the form of $25 credit to the first 200,000 folks who register their AmEx cards on the SmallBusinessSaturday.com. It's a way to pump money into the local economy - and in theory, back into our own bank accounts. And that's good news for those of us with debilitating personal debt, say Atlanta bankruptcy attorneys.

Continue reading "Atlanta Consumers Encouraged to Shop Local and Save Money Today" »

It looks like many Atlanta residents are going to spend this Thursday giving thanks for the food on their table - and the roof over their head.

Despite rising costs and holiday pressure, fewer homeowners are becoming delinquent on their house payments, according to new foreclosure data. Part of the change can be attributed to an improving economy and budget-conscious consumers. In fact, consumer debt is currently at the lowest rate it's been in years. On the other hand, experts say that another reason delinquency rates are down is that banks are finally evicting some homeowners who haven't paid the bills for months and months. If only they had known about their options.

Continue reading "Fewer Atlanta Homeowners Late On Mortgage Payments This Holiday Season" »

For some debt-riddled homeowners, the only way to make owning a home affordable is being able to take the mortgage interest deduction. But now it looks like Uncle Sam could revoke that tax break and similar deductions to pay for his own debts.

With the government deficit growing, President Obama has appointed a commission aimed at finding ways to balance the federal budget by 2015, according to MSNBC.com. And one way the commission could cut costs is by eliminating up to $1 trillion in tax breaks - including the popular mortgage interest deduction and child tax credit. That could mean a higher income tax bill for the majority of Americans, say Atlanta bankruptcy attorneys.

Continue reading "Growing Government Deficit Could Mean Higher Tax Bill for Atlanta Consumers" »

What's the scariest thing about the month of October? If you're a homeowner, it isn't Halloween - it's (gulp) your property tax bill.

But there might be a silver lining - property tax season is the one time when having the worth of your home decrease is a good thing. According to the National Taxpayers Union, up to 60 percent of homeowners could be overcharged because their home isn't valued correctly. With most of us struggling to just pay the mortgage, let alone a too-high tax bill, it's time to take action, say Atlanta bankruptcy attorneys.

Continue reading "There's More Than One Way for Atlanta Homeowners to Lower Property Tax Bill" »

It seems nothing has been able to slow the tidal wave of recession-related foreclosures - that is, until now.

State officials across the U.S. are joining forces to investigate illegal activities that could have led to thousands of unfair foreclosures over the past few years, according to the AP Press. Allegedly, lenders have been allowing foreclosure documents to be signed without required witnesses, without proper analysis and - in some cases - without even being read. It's a victory for millions of consumers who may be struggling to pay the bills - but are still following the rules, say Atlanta bankruptcy attorneys.

Continue reading "Foreclosure Process Comes Under Fire in All 50 States" »