New York may be one of the best states for homeowners facing foreclosure because of legal protections against mortgage fraud. However, those protections are costly to lenders and may end up costing New York borrowers more money, too. The foreclosure process in New York is the longest in the nation, taking on average 1,089 days to complete. A backlog of foreclosures has stalled the state’s housing recovery and has kept housing prices low. Now, the Federal Housing Finance Authority is considering fee increases for New York borrowers to compensate Fannie Mae and Freddie Mac for costly foreclosure delays. The good news is that the state’s lengthy foreclosure process means New Yorkers in default of their mortgages have multiple opportunities to try to save their homes from foreclosure. These options include filing for Chapter 13 or other forms of bankruptcy, a mortgage loan modification or a short sale. Chapter 13 bankruptcy allows a homeowner to reorganize debts into a court-supervised repayment plan and make manageable payments over time. For individuals with a steady source of income, Chapter 13 can be an excellent option for eliminating some debt, reducing interest payments and making a fresh financial start. By sticking to the Chapter 13 repayment… Continue reading
New Yorkers who are having difficulty making their monthly mortgage payments may wonder if a bankruptcy court can order a lender to modify a mortgage loan. The answer is no. While lenders cannot be forced into a loan modification,Chapter 13 bankruptcy offers a way to open the negotiations. In many cases, the parties agree to a mortgage loan modification as an outcome of a Chapter 13 proceeding. A loan modification is a tool that helps homeowners cure mortgage defaults. It involves altering the terms of the loan to create a payment plan that the homeowner can afford. A loan modification may include a lower interest rate on the loan, an extended term or adding any amounts in arrears back into the loan to increase the loan balance. By reaching agreement on a loan modification, a homeowner may be able to stop a pending foreclosure action. During the height of the housing crisis, members of the legal community lobbied for legislation that would give bankruptcy judges the authority to order loan modifications in bankruptcy proceedings. Those efforts were unsuccessful. As a result, the loan modification process requires tedious negotiations and much paperwork. With persistence, it can be accomplished. A mortgage loan… Continue reading
New York residents who are facing financial challenges likely are eager to receive their income tax refunds from Uncle Sam. Those extra dollars can be used to pay bills, reduce credit card debt, or even splurge on something special. But some taxpayers may not receive their refunds when expected. In some cases, receipt may be delayed. In other cases, if the taxpayer owes back taxes, is behind in certain other payments, or is in Chapter 13 bankruptcy, he or she may not receive a refund at all. Generally, the IRS issues most refunds, about 90 percent of them, within three weeks after receiving the taxpayer’s income tax return. There are a few reasons why it may take longer, such as an error on the return or a failure to include a proper form. The quickest way to get your money is by requesting that it be directly deposited to your bank account. The money will come about five days sooner than if you request a check to be mailed. If you owe back taxes or are behind on your student loan or child support payments, you may not get your refund. In those cases, the IRS likely will apply your… Continue reading
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