From the Living Dead – Zombie Mortgages?

Zombies are supposed to only exist in the movies and on TV shows.

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However, it seems that the zombie trend has transcended to the world of finance and the housing market.  Many news outlets have been reporting about “zombie mortgages”.

According to CNN, “[s]ince the housing bubble burst seven years ago, almost two million properties have started but never completed the foreclosure process, according to RealtyTrac…it’s estimated that tens of thousands could be zombie foreclosures.”

What is a Zombie Mortgage?

A “zombie mortgage”, according to CNN writer Les Christie, is when “borrowers move out after their bank schedules a foreclosure auction only to learn months or years later that the auction never took place or the bank never transferred the deed. That means the borrower still technically owns the house and is on the hook for property taxes, fees and homeowners’ association dues.”

From the chaos that has arisen from the housing market crash, many individuals have been left to deal with these debts that they believe have disappeared and they are no longer responsible for repaying.

Unfortunately, this is not the case.  In some instances, there are people who have multiple mortgages on their home.  In California when a first lien holder forecloses and there is a second mortgage or HELOC on the home, the second mortgage becomes a sold out junior lien and can still collect on the debt.

Is there a solution? 

Many people who are in this unfortunate situation do not have the means to escape from these mortgages and are unable to pay for them due to their financial situation.

However, one possible solution to assist these individuals is to file for bankruptcy.   Here at The Law Office of John Iaccarino, we have been assisting our clients in the San Francisco Bay Area with filing for bankruptcy (Chapter 7, 11, 13)  for over 20 years.  If you are currently dealing with a mortgage from a foreclosed home, we can assist you to determine what solution you have available to your situation.

 

 

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Mortgage Out of Control?

Many people dream of owning their own homes.  For some it symbolizes a new chapter in their lives with starting a family while for others it’s a smart long-term investment.  Regardless of the reason, it is an accomplishment in itself to be able to be a proud owner of your own home.  

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Unfortunately for some, the dream of owning a house can come with unforeseen challenges such as an inability to keep up with mortgage payments due to unemployment or underemployment, foreclosure, loan modification nightmares and difficulties dealing with banks and loan agents to list a few.

According to a recent article on SFGATE.COM, writer Carolyn Said shares that “a recent 8.5 billion dollar settlement to resolve charges that 10 major banks mishandled foreclosures and loan modifications is leaving many individuals uneasy as to whether or not this recent decision will rectify, saying details remain murky and that the amount of money will be minimal once distributed among millions of people.”  Read more…

With stories like these presented in the media everyday, it is no surprise that many individuals out there feel frustrated with no real solution to assist them in finding a solution to keeping their homes.

If you feel like you’re in a similar situation, seeking out legal assistance from an attorney in your area may allow you to resolve your financial problems related to your home.  If you are in serious debt and are at risk to losing your home and would like to attempt to keep it, one solution may be to file for Chapter 13 Bankruptcy.  

If you are considering filing for Chapter 13 bankruptcy, there are some immediate and long-term benefits to looking into your debt relief options for stopping foreclosure:

  • Automatic stay: As soon as you file and begin the bankruptcy process, you will be free from foreclosure, as well as wage garnishments and creditor harassment, because all collections activities must stop for the duration of a bankruptcy proceeding.
  • Curing arrearages: Chapter 13 can be a great way to reorganize your house debts to help you avoid foreclosure.
  • Keep your home: Oftentimes there are ways that we can work out a Chapter 13 that will allow you to keep your home and avoid foreclosure

The Law Office of John Iaccarino has assisted their clients for over 20 years on matters related to real estate, bankruptcy and foreclosure defense.  If you are located in the San Francisco Bay Area and are in need of legal assistance, please do not hesitate to contact our office.