Castle Law Office Blog | Missouri & Illinois Bankruptcy Legal Blog

The Loan Modification Program Fails to Secure Protection from Foreclosure for Another Missouri Resident

News reports have just come in that the loan modification program isn’t living up to its expectations. I had a client experience that only reinforced these reports.

A client just came in last week that was waiting on approval for his loan modification through NACA for 18 months. He was told not to make any payments for the entire 18 months. Now, he has been informed that he was not approved and has found himself $36,000 behind on his mortgage payments. His home is now pending foreclosure. Unfortunately for him, letting it fall behind that far put him in a position where a Missouri or Illinois chapter 13 bankruptcy cannot even help him, as he cannot afford to repay $36,000 during the life of his chapter 13 plan given his current income. He has no choice but to give up the home.

What is even more unfortunate about this story is that he is not the only one to find himself in this same situation. What can you do to avoid being put in this position? Well, any St. Louis or Wentzville, Missouri or Fairview Heights, Illinois bankruptcy attorney would tell you not to wait to start looking at your options. It is also not advisable to purposefully stop making mortgage payments so you can be eligible to apply for a loan modification and, in fact, as the story above shows, it is extremely risky.

This doesn’t mean that you can’t apply for a loan modification but, with only 4% of people getting approved, do you really want to take the risk? Request a free copy of my Missouri and Illinois bankruptcy book, “Get Out of Debt: Secrets Your Creditors Don’t Want You to Know” to learn if Chapter 13 bankruptcy could be an option for you to save your home.