Florida was one of the hardest hit states when the housing market crashed in 2008. Even all these years later, many homeowners are still feeling its effects. For many of those who are still delinquent on their mortgage loan payments, avoiding home foreclosure is a priority. The issue is whether their lenders are willing to give them the opportunity to do so.
Lenders may be willing to consider reinstatement or a repayment plan, but that would require any financial issues the homeowner is having to be temporary. In some cases, a forbearance — a temporary suspension or reduction of payments — might be enough to give an individual the time to get caught up on delinquent payments. However, for homeowners whose mortgage loan payments are higher than they can afford, financial trouble could return quickly.
This is why some Florida homeowners attempt to obtain a loan modification, which could offer a more permanent solution. Payments can be lowered through a variety of changes to a loan. Again, lenders will require that a good-faith effort be made to pay the current loan. In addition, they often look to see if expenses are being reduced.
For homeowners who are already struggling with their finances, none of these options may be viable. Filing for bankruptcy, however, could help with avoiding home foreclosure and also help with other debts that are taking a toll. It may be possible to keep the home in a Chapter 13 proceeding if the filer meets the qualifications, and Florida provides liberal property exemptions for filers. The bankruptcy process can be complex, and any misstep could get the case dismissed, which would put a homeowner back at square one. Therefore, it would be beneficial to enlist the advice and assistance of an attorney to help ensure that the process goes smoothly.
Source: FindLaw, “Behind on Your Mortgage Payments?“, Accessed on Dec. 27, 2015