What are my options?
If a foreclosure seems imminent or has already been initiated, a client has several options. First is to answer the foreclosure complaint and request mediation. In mediation, a debtor previously rejected for a loan modification may be able to get a second bite of the apple. And if the debtor has not yet applied for a loan modification, this may be the forum for initiating this process. Of course, mediation is not a cure-all and if negotiations fail here, the options are limited.
When loan modification efforts in mediation fail, the debtor basically has three choices: surrender the property, defend the foreclosure or file bankruptcy. If surrender is desired or necessary and a foreclosure complaint has been filed, we attempt to get “cash for keys.” Rather than go through judgment in the foreclosure, the lender will accept the keys to the property and provide a small stipend to cover the debtor’s moving expenses. This enables the lender to secure the property, foreclose, and move quickly to a sheriff sale.