What to expect if you cannot pay your mortgage – This timeline comes directly from the Department of Housing and Urban Development, in other words, HUD:
Once you get out of the habit of making a mortgage payment, it’s hard to get back to making that large payment every month. This is particularly true, with student loans also restarting payments now.
What do we do that can help solve this problem for you?
We litigate mortgage claims, assert consumer defenses when available and defend foreclosures in Florida. State law relating to foreclosures vary widely and we limit our practice strictly to Florida for mortgage related issues, generally in the counties surrounding Tampa Bay. We’re a member of a local Tampa Bay foreclosure defense attorney group, and NACA which is a national consumer advocacy group where consumer attorneys share ideas, tips and trends.
The regular FHA HAMP loss mitigation programs will remain in suspension until October 30, 2024 – next year! All foreclosure sales are to be suspended until the same date. Same with Deed in Lieu negotiations.
So what does that mean?
All borrowers who are already in default or at risk of imminent default are supposed to be evaluated under the expanded guidelines of the Covid 19 Recovery Option program. These provisions could be terminated early by Congressional action, executive or agency rules.
Back in the 2008 foreclosure crisis, one of the biggest problems was the lack of assistance for those who were not on the deed (such as following a death or divorce). Now there are new rules in place for successors in interest for instances where the homeowner may have died or transferred the home via a divorce decree of some sort. These new laws allow the “new” homeowner to unilaterally assume the role as successor in interest. Importantly, it does not require consent by the lender. In some cases, the “new” homeowner does not have to assume the mortgage loan.
Successor in interest means a person to whom an ownership interest in a property securing a mortgage loan subject to this subpart is transferred from a borrower, provided that the transfer is:
(1) A transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety;
“When do you need a foreclosure attorney?” was one of our highest performing videos last month. That has motivated me to prepare a series of blogs, guides and new videos to help consumers learn about their options and what they should be aware of when they are behind in their mortgage payments. This information is not intended to help someone represent themselves in a foreclosure action. That can get complicated and most people are not well suited to litigation. But this information should help a homeowner know what options are available, where to turn, timelines, and likely outcomes. All of that is necessary whether you are planning to keep a home or letting it go.
So why is this coming up now?
As of August 2023, many covid-19 related moratoriums have expired and have unplugged the pipeline of distressed properties. We are now at about 100,000 foreclosures nationwide, where in 2008 through early 2010 we had over 900,000 homes in foreclosure nationwide.
I ran across this statistic and wanted to share with you about the DOJ attestation process to discharge federal student loans. A great many are still pending.
Say you have a private student loan and you have previously filed a bankruptcy. Was your private student loan discharged? I’m presuming you did not file an adversary case to obtain a specific ruling as to dischargeability of these loans.
Loans that could have been discharged as beyond the cost of attendance, that portion that was over and above tuition, books, room and board etc. may be the subject of Homaidan. My understanding is that you can remain a class member for a discharge of any amounts that are outside of the cost of attendance and you’d remain responsible for anything else. You can also opt out and pursue relief on your own of that or the remainder of the loans, or seek alternative grounds for relief such as ineligible institution, non-dependent borrower or undue hardship.
We also would want to take advantage of any other programs out there such as the IDR recount going on right now. Normally, we walk borrowers through the process for that during our strategy session and get it done then. The IDR recount is huge – it’s allowing forgiveness for people with older loans, counting extended forbearances and other things to get to 20/25 yrs – the only requirement is that a borrower consolidate to Direct loans which would allow re-dating all of the loans for IDR purposes to the earliest repayment date of ANY loan contained with the consolidations. It works really well especially for those with older loans, or gaps between education. For instance someone who went to grad school during covid, can consolidate now with their undergrad loans perhaps in 1990s and their IDR start date for ALL loans would be six months after graduation from undergrad. Borrowers could obtain a full forgiveness of even the grad loans as soon as the consolidation finishes and the loan is reviewed under the IDR recount.
For people granted TPD, who are also eligible for IDR AUDIT Forgiveness, Dept. is moving TPD people from TPD forgiveness to IDR Audit forgiveness. While there is no 3 year income monitoring on TPD anymore, there still is a three year monitoring on TPD for things such as returning to school so moving them to IDR Audit forgiveness will give these people faster forgiveness.
Forgiveness before 12/31/25 is very good! That’s when the stimulus bill expires allowing for federal tax waiver on any student loan forgiveness (private or federal). It’s also when the TPD discharge provision providing for tax free forgiveness has to be re-funded by Congress. So forgiveness now is Great News! Even if the IDR Waiver is somehow stopped due to someone filing a court case down the road, it is unlikely to unravel a forgiven loan. Rather it would most likely stop anyone in the future from obtaining forgiveness. Of course, someone who has already consolidated their loans for the IDR recount can argue that they relied upon the program’s rules when doing the consolidation, and that laches (a fancy legal term for delay) prevents the creditor from asserting that now.
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Reboot Your Life: Tampa Student Loan and Bankruptcy Attorney Blog