Home Debt Settlement Mortgage Modification

Phoenix Mortgage Modification Attorney

Learn more about mortgage modification in Phoenix, AZ, and the Greater Valley Area. Call a lawyer at (602) 466-9631 to learn more today.

Providing Phoenix Homeowners with Mortgage Modification Legal Assistance

Since the Great Recession of 2008, home construction in Arizona has significantly declined, with only approximately 240,000 housing units produced between 2011 and 2020. The COVID-19 pandemic and inflation have further compounded the challenges associated with achieving homeownership. In this increasingly challenging landscape, favorable mortgage terms become a lifeline for Phoenix homeowners looking to secure their financial future. This is where Hilltop Law Firm steps in.

Hilltop Law Firm is a family-owned and operated firm, and we understand the financial and emotional distress homeowners face. Head attorney Cy Hainey, with over a decade of financial legal experience, and Samantha Hainey, with over 22 years of customer service, account management, operational, and leadership experience, work as a dedicated team to assist you in your time of need.

Don’t leave your home’s fate to chance–secure your path to a brighter financial future today. Contact a Phoenix loan modification attorney at (602) 466-9631 to schedule a free consultation with our debt relief team.

What Is Mortgage Loan Modification?

Your home is your family’s most important possession–and probably your biggest investment. In times of financial hardship, it can become increasingly difficult to make your monthly mortgage payments. If you fall too far behind, your lender could foreclose on your home.

Mortgage loan modification is a process that changes the terms of your existing mortgage to make it more affordable and manageable. The changes can encompass various aspects, such as lowering the interest rate, extending the loan’s duration, or even reducing the principal balance. It’s a crucial lifeline for homeowners struggling to meet their mortgage obligations.

Lenders often prefer loan modifications over foreclosure. It’s a win-win situation: homeowners retain their homes, and lenders avoid the costly and time-consuming foreclosure process. This preference gives borrowers the advantage in negotiating new terms that suit their financial circumstances.

When you pursue a mortgage loan modification, you’ll benefit from an automatic stay that temporarily halts creditor actions, providing you with breathing room to restructure your mortgage.

Mortgage Loan Modification in Chapter 7 Bankruptcy

Chapter 7 bankruptcy can be a challenging journey for homeowners. The process of mortgage loan modification in Chapter 7 bankruptcy involves the following:

  • Asset liquidation focus: Chapter 7 bankruptcy primarily centers around liquidating assets to repay creditors. This focus can make it difficult to retain your home, as the bankruptcy process aims to sell non-exempt assets to satisfy debts.
  • Court control: During a Chapter 7 bankruptcy, your property becomes part of the bankruptcy estate, subject to court control. Any mortgage loan modification must be approved by the court, adding complexity to the process.
  • Lender caution: Mortgage lenders are often cautious about proceeding with a loan modification in Chapter 7. They may hesitate to modify your mortgage terms until it’s clear that the trustee has no intention of selling your home to pay off your debts. This caution can delay the approval and implementation of your loan modification until the later stages of the bankruptcy process or even after the bankruptcy has concluded.

Your bankruptcy lawyer will guide you through the legal process and ensure your interests are protected every step of the way.

Mortgage Loan Modification in Chapter 13 Bankruptcy

Homeowners commonly choose Chapter 13 bankruptcy due to mortgage arrears, allowing for a loan modification. This option allows debtors to create a three to five-year repayment plan, making it popular for those seeking to save their homes from foreclosure. Chapter 13 stops foreclosure immediately and creates a payment plan that allows for regular monthly mortgage payments plus an additional amount toward the past-due balance. It can also reduce or eliminate medical bills, credit card bills, and other unsecured debt.

In this situation, debt relief may be obtained either with a loan modification or by filing Chapter 13 bankruptcy. If approved by your lender, a loan modification can stop foreclosure. The drawback is that homeowners may have to wait to find out if their applications for modification were approved.

In Chapter 13 bankruptcy, proposed mortgage loan modifications usually require the approval of the overseeing judge. This oversight ensures that the modification is fair and sustainable and benefits both the homeowner and the lender, providing a legal framework for restructuring mortgages and securing homes.

Once your Chapter 13 repayment plan is complete, you can begin making regular monthly mortgage payments to your lender, and your loan will be in good standing. You can even apply for loan modification to further reduce your payments once you start your repayment plan.

  • Extending the loan term: If you are struggling to make your mortgage payments, extending the term of the loan could lower the amount you pay every month. The drawback is that you will pay more on your mortgage in the long run.
  • Lowering the interest rate: Interest rates can fluctuate. If rates are lower now than they were when you first took out your mortgage, a loan modification could reduce your monthly payments and save you money.
  • Adding missed payments to the end of the loan term: If you are behind, this could help you catch up.
  • Restructuring the loan: If you are living on a fixed income, you need your monthly mortgage payments to be predictable. It may be possible to modify your loan from an adjustable-rate mortgage (ARM) with interest rates that change periodically to a fixed-rate loan.

Guiding You to a Brighter Financial Future

At Hilltop Law Firm, we understand the urgency and stress that financial emergencies can bring. That’s why we’re dedicated to helping Phoenix residents effectively navigate the challenges of home ownership.

If you’re an Arizona homeowner facing financial hardship, call us at (602) 466-9631 for a free consultation. Let’s see how we can help.

“Settled my debt quickly and for less than I could have imagined! I would definitely recommend”
- Chelsea