Foreclosure can force a New York family out of their home. The failure of a mortgage holder to make timely and complete payments toward the outstanding obligation can initiate the foreclosure process against his property. Legal processes, like bankruptcy, can help stop the foreclosure process, and from time to time, the government offers struggling mortgage holders help with avoiding the pains of foreclosure.
For example, just recently the Federal Housing Finance Agency decided that it would lower interest rates, as well as principal amounts owed on some American’s mortgages. To qualify for the government’s help, mortgage holders must owe at least 115 percent of their mortgages’ values and be more than three months behind on their mortgage payments. These individuals are considered significantly underwater on their mortgages, and the goal of the aid is to reduce their likelihood of falling into foreclosure.
Though, this government-backed assistance may seem like a good opportunity for individuals who could lose their homes, it only will reach a handful of people who need this type of support. Only about 33,000 mortgage holders will be able to take advantage of this program, while more than six million people currently own underwater properties in the United States.
This means that the vast majority of people with underwater properties will find themselves in the same precarious financial situation after the program provides its aid. Those who do not qualify will have to find alternate means of keeping their homes out of foreclosure. As a result, people who wish to proactively counteract potential foreclosure proceedings may wish to speak with bankruptcy and debt relief attorneys now about their options.
Source: Marketplace, “Help arrives for (some) underwater homeowners,” Sabri Ben-Achour, April 15, 2016