Atlanta Bankruptcy Attorney Blog

It's bad enough that countless people are losing their homes because they can't pay the bills. But imagine the frustration of finding out you're losing a home you've paid off.

As banks rush to push through millions of foreclosures in 2012, errors are increasingly leading to foreclosures, lawsuits, and credit damage for consumers who are current on their loan payments.

With an estimated 12.5 percent of U.S. homes either in foreclosure or delinquent by at least a month, the problem is only expected to get worse.

Regardless of the reason for foreclosure, Chapter 13 bankruptcy may be the best way to legally stop the foreclosure process and allow homeowners to begin rebuilding their credit.

According to a recent Reuters story, a growing number of homeowners are reporting that they are being harassed by banks for mortgages that should have been recorded as paid in full.

In some cases, borrowers refinance a home loan but the original mortgage is never written off. In other cases, homeowners are sued for foreclosure on a house they sold years ago. And in some rare but worrisome cases, consumers are being pinned down for delinquencies when they never even had a mortgage to begin with.

It all comes down to the disorderly state of the lending industry.

During the peak of the housing boom in the mid-2000s, Wall Street encouraged mortgage servicers to quickly process loans so they could be sold around the world to thousands of investors. In the ensuing chaos, important legal procedures were brushed off.

Many times, Atlanta bankruptcy lawyers have seen homeowners have difficulty qualifying for a loan modification because the bank can't locate the owner of the original loan. Now homeowners are being held accountable for home loans that aren't even theirs. Because data has never been collected on wrongful foreclosures, there is no way to estimate the extent of the problem.

In one case, a Utah woman's accountant learned that the woman was being sued for foreclosure because a bank error had showed she was delinquent by a single dollar. As a result, her credit was ruined. In another instance, a Vietnam vet paid off his mortgage in full, only to have his bank continue sending notices in error.

It's an important reminder of how necessary it is to keep an eye on credit so that mistakes can be quickly corrected before they spiral out of control.

In the meantime, Atlanta bankruptcy is a helpful tool to have handy.

Errant fees and legal troubles can add up to cause serious financial hardship, whether deserved or not. And of course, many times foreclosure stems from a true inability to make payments, whether due to job loss, credit card debt, or medical bills.

Continue reading "Atlanta Bankruptcy May Help Consumers Plagued by Wave of Mortgage Errors " »

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" »

Every month, just like in October, foreclosures increased throughout the Atlanta metro area. This time, they increased at a higher clip than usual.

Foreclosure in Atlanta and throughout the state has been a problem that has hampered local and state economies, made housing prices plummet and caused many homeowners heartache.

Yet bankruptcy, usually Chapter 13 bankruptcy in Atlanta, can help homeowners save their houses. Atlanta bankruptcy lawyers have been able to help many people save their houses through this process. By eliminating debt and setting up a payment plan for three to five years, people can hang on to their homes and still pay off the debt that is causing them so much stress.

With foreclosure notices constantly on the rise, the real estate market will not recover for years or perhaps decades. An increase in foreclosures means a steady decline in prices for houses. And as unemployment remains steady, this spells disaster for the economy.

Most analysts believe that major banks halted their foreclosure processes last fall in order to revisit how they could handle all these foreclosure cases -- millions nationwide -- without illegally signing fraudulent documents, using robo-signing practices and fabricating documents to support their foreclosure filings.

That's why 15,000 fewer foreclosure notices have been filed this year compared to last. But now that banks appear to have gotten that figured out, they are again starting to file hundreds of thousands of notices and nearly 11,000 in the Atlanta area alone, the newspaper reports.

Analysts with Equity Depot told the newspaper that the numbers show a large number of second and third foreclosure notices, meaning banks may be taking action against people who are furthest behind in payments. Another trend is that more foreclosure notices are being filed against people with prime mortgages, rather than sub-prime mortgages, which were made to people with greater credit risks.

Cobb County set a new high for the year in October with 1,333 notices sent out, while Douglas (410), Hall (332) and Rockdale (259) counties also experienced highs. DeKalb, Fulton and Gwinnett counties all hit more than 1,500 notices for the month.

There have been 102,094 notices filed in the metro Atlanta area this year compared to 117,437 at this time last year, the newspaper reports.

Some could take the latest statistic as a good sign, given that notices are slightly lower than they were last year, but considering banks severely halted their foreclosure filings for the better part of a year while states investigated them for robo-signing and illegal document filing and they're still close to last year's levels shows that they have more than made up for the time lost.

While it's true that banks appear to be going after the most delinquent borrowers first, many homeowners are at risk. And even people far behind in making payments can save their homes through bankruptcy. Filing for bankruptcy immediately stops foreclosure and ensures that creditors are shuffled to bankruptcy court as it stops them from contacting the homeowner.

Continue reading "Foreclosures On The Rise But Atlanta Bankruptcy Can Help" »

Despite ongoing investigations by all 50 states, including the Office of Attorney General of Georgia, an Associated Press investigation recently revealed that mortgage companies are still using "robo-signed" documents in foreclosure cases.

Many hoping to safe their homes are using allegations of faulty paperwork. However, banks can fix paperwork and still foreclose on a home. But what banks can't do is foreclose on a house if the homeowner has filed for Chapter 13 bankruptcy in Atlanta. Atlanta Bankruptcy Lawyers have helped countless homeowners save their houses after filing for bankruptcy.

According to The Associated Press, county officials in at least three states say they have still been receiving documentation that appears to be "robo-signed" as opposed to actually signed by bank officials who have reviewed it for accuracy. "Robo-signing" means that mortgage servicers, companies that banks have hired to process paperwork in foreclosure cases, have signed documents that have purportedly been reviewed for accuracy, though they haven't.

The attorneys general in all 50 states have launched investigations into alleged "robo-signing" in order to protect the rights of homeowners. The Associated Press reports that last fall, the nation's largest banks and mortgage lenders, including JPMorgan Chase, Wells Fargo, Bank of America and an arm of Goldman Sachs, suspended foreclosures while they investigated how corners were cut to keep pace with the crush of foreclosure paperwork.

Critics say the new findings point to a systemic problem with the paperwork involved in home mortgages and titles. And they say it shows that banks and mortgage processors haven't acted aggressively enough to put an end to widespread document fraud in the mortgage industry.

"Robo-signing is not even close to over," says Curtis Hertel, the recorder of deeds in Ingham County, Mich., which includes Lansing. "It's still an epidemic."

The story points out some scary findings, which show that banks and lenders haven't taken seriously the problem of robo-signing and still have yet to cope with the droves of foreclosures in the real estate market nationwide. But they are on notice to improve their documentation, which could be troublesome for many homeowners.

But where bankruptcy comes in is simple. Are you facing piling debt because of medical bills, job loss and credit card debt? Have you begun missing payments on your house but want to keep your home? If this seems like your situation, Chapter 13 bankruptcy in Atlanta could be a solution.

Under this code of law, a consumer can keep large assets and set up a payment plan over three to five years that would eliminate debts after they are paid off. Filing for bankruptcy immediately halts the foreclosure process and stops creditors from calling. Working with an experienced Atlanta bankruptcy lawyer can help you save your home and get on with life.

Continue reading ""Robo-Signing" Continues, Despite Georgia Attorney General's Investigations" »

A recent report by The New York Times states that the percentage of homeowners has reached 1998 levels and could continue declining to levels not seen for 30 years as people are trapped in upside down mortgages and dealing with foreclosures in Atlanta and elsewhere.

Atlanta Bankruptcy Attorneys have seen the frustration experienced by homeowners dealing with mounting debt or uncooperative banks. We know that there are always bills to pay and with unexpected medical bills, the loss of a job or increasing credit card debt, it's not always easy. That's why we are here to guide people into making the best decisions for their financial futures.

The New York Times article reports that given the Great Recession and the collapse of the nation's housing market, the percentage of homeowners has dropped to a low level of 66.4 percent. That's down from 69.2 percent in 2004. Analysts believe the levels could continue declining.

Many people believe the drop in home ownership is simply a matter of the economy -- lost jobs, more debt and an increased number of foreclosures. But because of the recession and the problems people are having with their homes, many Americans don't see owning a home as part of the American Dream anymore. Fears of having their house fall into foreclosure because of a market collapse has caused many people to become satisfied with renting.

Bloomberg reports that the S&P/Case-Shiller index of property values in 20 cities fell 3.6 percent from March 2010, the biggest year-over-year decline since November 2009. The index is the lowest it has been since March 2003, which analysts believe means prices will continue to steadily drop.

Atlanta Bankruptcy Attorneys have seen the many people who are struggling to make payments and wished they had never bought a house in the first place. But there are also many others who are frustrated by the housing market collapse and who want to stay in their house, though it has become increasingly difficult to make payments. Still, they find banks are often unwilling to modify a loan in Atlanta.

So for many, the answer is to file Chapter 13 bankruptcy in Atlanta. Chapter 13 bankruptcy is different than Chapter 7 bankruptcy, which people may be more familiar with. Chapter 13 allows people to stay in their homes and propose a payment plan over a 3- to 5-year period to satisfy their debts. It may also pressure banks into making a modification.

While many people may think bankruptcy is embarrassing, they shouldn't. Millions of people have used these laws to protect them and to recover from debt caused by credit cards, large medical bills or unemployment.

According to March statistics by the United States Bankruptcy Court, nationwide Chapter 13 filings rose 5 percent to 438,788 from the 415,966 bankruptcies filed in the 12-month period ending March 31, 2010. The number of Chapter 13 filings came in second only to Chapter 7 filings.

Continue reading "Georgians' Dream of Owning a Home Dropping; Bankruptcy and Foreclosure Defense are Options" »

A New York Times article reports that the institutions that service about two-thirds of the mortgages in the United States have offered $5 billion to settle allegations of robo-signing and other shady practices that wrongfully took away homes from troubled borrowers.

It's not news that foreclosures are a problem in Georgia and elsewhere in the United States, but what is disturbing to Atlanta DebtStoppers is how banks and financial institutions think they can just cut a check and pay off the unethical and immoral acts they have committed with the rise of mortgage foreclosures. If you or a loved one needs help stopping foreclosure in Atlanta, call today.

Financial institutions have come under fire by attorneys general across the country because of allegations of immoral practices, such as robo-signing, where mortgage servicers paid by the banks to process paperwork would sign documents without looking at them. Many of the documents, which were supposed to be signed by executives, were rubber-stamped by unqualified workers. Some were forged.

In many cases, banks also lost paperwork, or used paperwork that was incorrect in the process of trying to foreclose on a person's house. All of these problems have denied homeowners due process in the handling of the foreclosure process.

While attorneys general want the banks to pay $20 billion for their transgressions, the banks offered only $5 billion. The Wall Street Journal later reported the states' head prosecutors countered with $17 billion.

But as the banks and states negotiate a settlement, the housing market hasn't gotten any better. Banks own nearly 875,000 foreclosed homes, according to RealtyTrac, a research firm. New home sales are sluggish and existing home sales aren't very good, either.

What does all this mean for you, the homeowner who is struggling to get by making payments on a home that may not be worth what you paid for it? It means you should consult with an Atlanta Foreclosure Attorney if you think you will soon fall behind on making payments on your house.

It's rare, but sometimes possible, for a homeowner to successfully convince the bank to modify their loan to correspond with its current value. While it can happen, financial institutions have been unwilling to help homeowners who want to try to stay in their houses. They would prefer to file a foreclosure lawsuit, go to court and hope a judge slams the homeowner with a judgment.

If you are already in foreclosure but want to save you house, discussing Chapter 13 bankruptcy could be an option for you. It immediately stops foreclosure and allows you to work on a 3- to 5-year payment plan to pay off your debts.

Continue reading "Banks Hoping to Pay Fines to Settle Bad Foreclosure Practices in Atlanta, US" »

The Atlanta Journal-Constitution recently reported that foreclosure notices in the Atlanta area rose 22 percent in May from April.

If you are upside down on your mortgage like many Georgians, consult with an Atlanta foreclosure lawyer so you can fight for your home. In the near future as many as 7 million American homes will fall into foreclosure, so you're not alone. In Georgia, there is both judicial and power of sale foreclosure, meaning the lender can schedule the sale of your house without even telling you after you're in default. Don't let this happen to you if you're going to fall behind your payments and slip into foreclosure in Georgia.

According to the news article, 9,350 notices were filed in the 13-county Atlanta metro area in May. But it's possible that lenders are still lagging in how many foreclosures they file with the courts because of well-documented problems with law firms filing "robo-signed" false documents or banks being unable to come up with the proper paperwork for a person's home loan.

Many experts are expecting a large wave of foreclosure filings once banks figure out which paperwork is correct and which has been falsely filed against homeowners. In Gwinnett County, nearly 2,000 foreclosures were filed in May, followed by Fulton (1,804), DeKalb (1,472), Cobb (1,152) and Clayton (791).

Statewide, there were nearly 8,500 foreclosures filed in April, the Rome News-Tribune reported. That was down 35 percent from March.

This is all depressing news. But don't let the banks take away your home without a fight. There are ways to stop the process and the first step is contacting an Atlanta foreclosure attorney who can help you.

First, here are some tips of what not to do if you're facing foreclosure. You shouldn't trust a third-party mortgage modification company, foreclosure rescue specialist or debt settlement company. These simply won't work.

What you should do if you're facing foreclosure is attempt to modify your loan or meet with DebtStoppers to see if there are other avenues to save you home. It's possible that Chapter 13 bankruptcy in Georgia could be best for you. You can set up an affordable payment plan to satisfy debt without losing your home.

Continue reading "Consult an Atlanta Bankruptcy Attorney to Stop Foreclosure" »

The government's plan to kill its mortgage modification program will likely have a minimal impact on consumers; the plan distributed only about $1 billion of the $50 billion earmarked for foreclosure prevention as banks fought the government every step of the way.

For many trying to stop foreclosure in Atlanta, even acceptance turned out to be a disaster. Reports are commonplace of banks using the program to grant temporary assistance, only to reject permanent modification and use the resulting arrears to file foreclosure action. In other cases, homeowners fought for more than a year to get meaningful relief, only to be denied.

Consulting a bankruptcy lawyer in Atlanta who is familiar with the options for dealing with bad mortgage debt is your best option. Even short sales or strategic defaults could result in severe financial consequences if your bank pursues a deficiency judgment -- which it may do for up to 10 years.

The New York Times reports Republicans have voted to kill the Home Affordable Modification Program (HAMP). While Democrats may try to revive it, even they admit the program has been an abysmal failure.

More than 225,000 foreclosure filings were recorded in February, according to RealtyTrac -- putting the country on pace to record another record year of home losses. And home prices have declined for the sixth straight month -- very near their lows, which would put the housing market in a double-dip recession.

A review of the program recently determined that the government's only enforcement powers come if a bank is offering too much assistance -- which has been anything but the problem. The program helped little more than 600,000 of the 1.5 million who applied. At its launch, the government had hoped to modify as many as 4 million loans.

Banks routinely lost paperwork and made it as difficult as possible to apply -- frequently telling mortgage holders they needed to be delinquent to qualify.

-Despite the epic antics of the banking industry, treasury officials have not fined a single mortgage servicer.

Those looking to appeal a denial by a mortgage servicer must start by participating in counseling via a hotline established by the mortgage industry.

Continue reading "Mortgage Assistance Program Fails -- Struggling Atlanta Homeowners Best Served by Qualified Attorney" »

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" »

The good news is that a new FHA program could help underwater borrowers make their mortgages more affordable. The bad news? For many homeowners, it's too good to be true, say Atlanta bankruptcy attorneys.

Known as the Short Refi initiative, the program allows lenders and investors to agree on writing off a portion of a loan's principal balance - at least 10 percent. Borrowers are able to participate so long as they don't currently hold an FHA loan and are current on their house payments. So what's the problem? Loans held by government-backed Freddie Mac and Fannie Mae - in other words, the majority of mortgages in the U.S. - are ineligible.

Continue reading "Is Loan Modification Or Bankruptcy A Better Choice for Atlanta Homeowners?" »

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" »