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In the US, Foreclosure Has Become a Household Word

Recently, you probably can’t turn on the TV without hearing something about foreclosure. Over the last three years, there has been much attention drawn to the failing real estate market and how many Americans are losing their homes to foreclosure. Currently, there is a lot of finger-pointing going on and no real solutions. Initially, the White House pushed for a loan modification program that would help people struggling to meet their mortgage be able to reduce their payment and not lose their home to foreclosure. Just as most of us expected, the program didn’t work. Only 5% of those who applied for a loan modification actually got one. The sad thing is, many of these people could have qualified to file for bankruptcy and might’ve been able to save their home through different means. But now the bank is breathing down their neck and proceeding with the foreclosure because they don’t have the money to come up with all the back payments. There was a report there was released recently that said there was over 6 million houses in default or in danger of being in default. What’s interesting is, the numbers of foreclosure aren’t matching this making people wonder why are there so .

This dilemma was clarified after some bankruptcy attorneys started suing the banks. I guess a bankruptcy attorney figured out how the banks were trading paper on the derivatives market and it has gotten so convoluted there was no real way to prove who actually owned the piece of property. After that, many banks were accused of Robo signing foreclosure papers, without even doing diligence to make sure they still owned the property. With a few wins under their belt, bankruptcy attorneys nationwide started jumping on the bandwagon. Now, the banks are making sure their I.’s are dotted in their T.’s are crossed. It’s been called to my attention that a foreclosure prior to 2010 would take less than six months and now it’s closer to a year. Depending on the area people are living in and if the real estate market is even moving, will also determine how aggressive a lender will proceed. There are many stories out there of how some folks have been lucky to stay in their home for two or three years without making a payment. When times get tough, people shouldn’t bury their head in the sand waiting for the Sheriff to show up, but immediately consult a bankruptcy attorney and see if filing bankruptcy might be a way to stop foreclosure.

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