Trial Loan Modification, Stopping Foreclosure
Is it True? Banks are really trying to help slow down foreclosures?
Can’t Be… Yup for Real!
For the first time, we actually had a bank decide to stop a foreclosure for 90 days provided our client agreed to resume payments – at a lower amount than their monthly mortgage payment. They are calling it a “Trial Loan Modification.” The bank, in fact is Washington Mutual (WaMu) the soon to be Chase. If the client meets his obligations for 90 days, WaMu is willing to consider a permanent modification (they do not say on what terms). Further, WaMu agrees to “suspend” the foreclosure proceeding during the trial period.
This is a great short-term victory for the homeowner. He gets 90 days to catch his breath without having to worry about the foreclosure proceeding moving along. For Oppenheim Law, it’s great because we buy our client even more time, thus allowing him even more options.
It is also good for the community at large since it reduces the flow of foreclosures onto the market and the bank benefits by not having to take another house into its foreclosure inventory.
Of course the proof will be in the pudding in 90 days to see what kind of true deal the bank offers our client as a permanent loan modification.
In any event, if the deal turns out to be a Trojan horse we do not give up our client’s right to continue to fight the foreclosure. Ironically, however, had the client not initially fought the foreclosure with us, they would have already have lost their home and I would not have had another small victory to blog from the trenches.