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Besides mortgage modification, there are many other possible methods to prevent foreclosure, otherwise called “Foreclosure Solutions”. Foreclosure Solutions are varied and depend on many factors; they include litigation (answering the Complaint, defending the foreclosure action, and Emergency Orders to Show Cause), negotiations other than modifications (forbearance agreements, short sales, and deeds-in-lieu), and bankruptcy (chapters 13, 7 or 11). We can advise and represent our clients in all of the possible solutions to the foreclosure process; these potential solutions are reviewed based on the client’s goals and the stage of the foreclosure proceeding.  In order to  decide which Foreclosure Solution to pursue,  we ask our clients several important questions as follows: i) At what stage is the foreclosure?; ii) What is your main goal as to the house?; and iii) What is your main financial difficulty in terms of the mortgage? We explore and offer to our clients the possibility of all Foreclosure Solutions as follows:

1. A Negotiated Agreement with the Mortgage Holder  – Negotiated agreements are broader than modifications and most lenders would be willing to engage in a negotiated agreements, even if they are not initially willing to consider a modification. A negotiated agreement can be attempted when the homeowner first falls into arrears and prior to and throughout the foreclosure proceeding. However, it is usually a strong option prior to the initiation of the foreclosure, and in the early/middle part of the foreclosure process, for a client that hopes to keep their home. By obtaining a negotiated agreement with the lender, homeowners may end the danger of foreclosure.  Because negotiations are consensual on the part of  lenders, the effort to negotiate is often accompanied by other legal efforts on the part of the borrowers.
2. A Litigated Defense of the Foreclosure Action  – A litigated defense of the foreclosure action, initiated by filing an answer or motion to dismiss, needs to take place 20-30 days after a client had been served with the Summons and Complaint in the foreclosure action. Foreclosure Defense also involves discovery, motion practice and attending settlement conferences.  If the foreclosure is nearing the end and/or if a foreclosure sale is scheduled, an Emergency Order to Show Cause in the state supreme court may obtain a “stay” of the foreclosure sale. Foreclosure defense focuses on defects in the foreclosure process and is used to slow down the foreclosure to give time and leverage to the client so as to increase the likelihood of a successful resolution through other negotiated means.
3. A Chapter 13 Bankruptcy Case Designed to Allow a Cure Over Time for the Mortgage Arrears  – A Chapter 13 case, unlike a mortgage modification, is non-consensual and therefore allows more certainty in stopping the foreclosure action through the “automatic stay” which goes into effect immediately upon the filing of a bankruptcy case. Under Chapter 13 the client needs to catch up on mortgage arrears under a 5 year plan while going back to making regular mortgage payments. Chapter 13 is usually filed later in the foreclosure process by homeowners who have not been able to or who do not want to wait to get a modification, or who need to stop a foreclosure sale. Assuming that a client can make the monthly payments required under the Chapter 13 plan, this is good structured method of saving a home from foreclosure.
4. A Voluntary Sale of the Property, Pursuant to a Contract of Sale – A voluntary sale is often a “Short Sale” since many properties in foreclosure are “upside down” in that the mortgage payoff exceeds the fair market value of the property. A voluntary sale requires a qualified buyer who has entered into a contract with the homeowner in foreclosure. If the sale is a short sale the contract needs to be conditioned on consent by the lender who needs to agree, pursuant to negotiation efforts, to accept such lesser amount as the full payoff.
5. A Refinancing of the Property – If there is still equity in a house and the homeowner is eligible for refinancing or a reverse mortgage, obtaining a refinancing of the property is a potential method of paying off the arrears that may otherwise cause a foreclosure.
6. A Chapter 7 Bankruptcy Case Designed to Eliminate Debt – Often the homeowner in arrears on their mortgage also has considerable other unsecured debt due to their overall financial difficulty. A Chapter 7 case could discharge the client’s credit card, personal loans and other unsecured debt so that the client may have a better likelihood of obtaining a modification, without the burden of a considerable amount of debt that would otherwise diminish from the client’s ability to make payments under a potential modification.

The Law Firm of Ronald D. Weiss, P.C. has negotiated hundreds of agreements giving its clients the opportunity to catch up with their mortgage arrears. Besides negotiating many mortgage modification agreements, we have negotiated forbearance agreements, payment plans, short sales, deed in lieu agreements and other settlements, which have resolved the foreclosure process. Allowing us to represent and negotiate terms for you ensures a prompt resolution of the foreclosure process. Also, it is critical to have the settlement terms agreed to in a legally binding written stipulation of settlement while making sure that your rights are protected at all times.
Please call us at (631) 271-3737, or e-mail us at weiss@ny-bankruptcy.com for a free consultation to discuss such legal options in greater detail.