Home Foreclosures and Divorce
Recently, I attending a CLE (continuing legal education) class and learned some information regarding home foreclosures. Attorneys are required to attend continuing legal education courses and we must report every three years and earn at least 45 credits in order to continue to be bar certified. This ensures that attorneys are keeping up to date with new changes in the law. The recent speaker said that as of August 2010 there were 28,000 foreclosures in Oregon. It is no secret that Central Oregon has been hit hard. What can you do to stop a foreclosure? One way is to file a bankruptcy and it is always helpful to get advice from a bankruptcy attorney even if you end up not filing one. The speaker talked about the HAMP program which is the Home Affordable Modification Program. It only applies to personal homes and not commercial real estate or rental properties. There is a web site that might be helpful: making home affordable.gov. Unfortunately, it can take at least 9 months to get through the HAMP program and the speaker said that it can be discouraging. She suggested that people contact HUD approved agencies that have HUD Government counselors who can help guide you through the process. If you are doing the modification process then it is important to understand you can’t file bankruptcy. The speaker warned that there are shady people out there ripping off the consumers pretending to be able to modify loans for a fee. Please be extra leery of companies that charge a fee for the process as several people have been deceived and lost money. There is local house counseling that is free and you also make be able to access attorneys who could help through the Oregon State Bar. What are the steps of a foreclosure? If you miss payments, then a 30 day default letter is sent and then they usually give 120 days before the property is sold on the courthouse steps. Recently, there is new legislation that allows the debtor to meet with the mortgage holder and see if something can be worked out. The speaker reminded the attorneys that holding onto a house is not always in a client’s best interests. Sometimes, as hard as it is, it is better for the client to cut the losses and start over again. The speaker pointed out that sometimes the 2nd mortgage (home equity) can’t be dismissed and that debt can cause trouble down the road for a divorcing couple. The issues are complicated and it is worth your money to seek at least a consultation with an attorney who is knowledgeable in the area of foreclosures.