38 Rock Street, Suite #12, Fall River, Massachusetts 02720
Once I Receive a Notice of Foreclosure, What Are My Next Steps?
You suffer some type of setback (divorce, etc.) or your adjustable rate mortgage has just increased to the point
that you will have great difficulty making future payments on time, what do you do?
(See Foreclosure F.A.Q. for further frequently asked questions)
Take massive action Immediately !! (In the words of Anthony Robbins) This crucial step is the one thing many
homeowners fail to do, they feel overwhelmed and resigned to their fate, when in some cases there were other
options available if they only had acted IMMEDIATELY.
Contact your lender at once, and explain the situation. If you foresee your "setback" as being somewhat short
term, lenders will generally work with you as they really do not want to go through the expense of selling your
home at a loss, and then have to hire a Realtor to sell it for them.
If you are 2 or months behind on your mortgage, or have received a notice of foreclosure from your mortgage
holder you may feel resigned to the fact that there is nothing you can do to save your families home. However,
what alot of people do not realize is that just because the mortgage company is foreclosing on your home,
doesn't necessarily mean you will automatically lose your residence. But you must act swiftly!
Do not ignore notices sent to you, contact your lender immediately if you feel that payments will be difficult for
you to make.
It is quite possible that yout lender will enter into a loan workout agreement with you, however sometimes the
lender's employees do not fully understand the process and try to discourage you. Don't allow this to happen
without trying to speak to a supervisor. Having an attorney call on your behalf usually reduces this type of behavior
and the odds are greatly increased that the lender will agree to work out a plan with you.
Another possiblity involves what is called a "short sale". This is where your lender agrees to take less on the
home than it is appraised at. Traditionally if the sale of the home is less than your loan amount, it was considered
a windfall for the homeowner, and subsequently this difference was added into your taxable income for the year.
So in a short sale, not only were people losing their homes, they were also receiving another devastaing blow of
significantly increasing their taxable income for the year.
Fortunately many people qualify for relief from this taxation when Congress enacted the
Mortgage Forgiveness Debt Relief Act of 2007.
There are Rules for debt forgiveness:
• The debt must have been discharged by the lender in 2007, 2008 or 2009.
• The amount of debt that can be excluded is limited to million.
• The exclusion can be used only if the loan was taken out to acquire, build or substantially improve a principal residence.
• Forgiveness of debt on vacation homes, second homes and investment property doesn't qualify.
• Debt forgiven on a cash-out refinance or home equity loan must be apportioned between the amounts used for home acquisition, Ill.
construction or improvement and amounts used for other purposes such as tuition, travel or repayment of other debts. Only the allowable ,
portion qualifies for the tax break, says John W. Roth, a senior tax analyst at CCH, a provider of tax services, software and information in
Contrary to popular belief just because you are behind on your mortgage payment doesn't always mean you
will lose your home, but you MUST to act immediately, I may be able to defend your Massachusetts foreclosure.
YOU MUST ACT IMMEDIATELY, AS YOU MAY LOSE YOUR RIGHT TO FORECLOSURE DEFENSE IF YOU
WAIT TOO LONG !
*If you have questions about forclosure prevention, or Massachusetts and Conecticut foreclosure defense, please
contact me for a no obligation discussion about your situation. I will look at your situation, and If I can help you,
I'll let you know, if I can't, I'll tell you know that too, and if possible refer you to someone that can help you. "
The most recent update of this page occurred on 08/19/2008.
Nothing contained herein should be construed to constitute advice for your personal circumstances. This is
intended as a peripheral exposure to the various options available, but by no means is this a comprehensive
or exhaustive analysis of the bankruptcy laws or their alternatives. Whether or not you should file a Chapter 7
bankruptcy, Chapter 13 bankruptcy, or any bankruptcy, will vary depending on your personal circumstances
and should only be undertaken after careful consideration, analysis and after consultation with an attorney
experienced with such matters. These pages may contain information and rules peculiar to the Commonwealth