Bankruptcy is often the best way out of a mortgage morass

By Tim Grant, Pittsburgh Post-Gazette.

Attorneys say bankruptcy court more effective than many loan modification efforts.

Trying to work with a lender to modify an existing mortgage can be so onerous and complex that many borrowers give up. And it’s not much easier for lawyers who work on behalf of clients facing foreclosure.

“What we have found is that it’s easier to take someone facing foreclosure into bankruptcy because the modification process has no teeth,” said Alan Patterson, a partner at the Gross & Patterson law firm, Downtown.

“As attorneys, we don’t seem to have the ability to force banks that are foreclosing to modify the terms of their loans,” Mr. Patterson said. “There’s really no one to talk to on the mortgage side to get anything accomplished.” …

Max teaches that the best way to get a sustainable mortgage loan modification is to gain legal leverage against the banks.  As has been seen many times on this blog, the mortgage servicers who are controlling the process have no financial incentive to modify your loan and every financial incentive for you to be in default and begin foreclosure proceedings. Attorneys learn how to gain this legal leverage at this Bankruptcy Boot Camps and his Mortgage Securitization and Servicing Seminars.