Modifying Mortgage Loans

Part of the divorce mediation process includes assessing and re-organizing your finances.   Each asset and liability is considered in the division of marital property.   Unfortunately, in the current housing market, the family home, which was once an asset, may now be a liability.  Determining what to do with the marital home and the associated loan and mortgage can be challenging.    Mediators guide couples to explore the possibilities.  

Many homeowners are eligible for the Home Affordable Modification Program (HAMP) that began in 2009.  Under HAMP, some borrowers can save their homes by permitting qualified borrowers to re-write their mortgages to reduce the interest rate and monthly loan payment.  This helps people avoid foreclosure.   The program initially gives temporary relief, during which time the borrower makes reduced payments.  If the borrower is successful in making the payments during the temporary period, then the Bank will provide a permanent modification.  [Read more...]

Divorcing Couples Manage Debt

Divorcing couples have to make tough financial decisions, not only about how to divide assets, but how to allocate debt. Depreciating real estate values along with the current financial landscape, pose even greater challenges for folks who are separating, particularly when the marital home, once the base of financial security, becomes a liability. Rest assured you are not alone, many folks find themselves in the unfortunate situation of owing more on their home than it’s worth. For some, this is not a problem, but for divorcing couples who want to sell or refinance, it’s complicated. Money Management International hosts a website (www.moneymanagement.org) containing many ideas you can use to reduce spending and manage debt.

Money Management International, formerly Consumer Credit Counseling, is a non-profit organization that has been in business for many years. This service is free. They offer confidential budget, credit and housing counseling. Financial consultants work with you to consolidate and reduce your monthly debt. Their website and services are accessible in English and Spanish. Personal advisors can be reached by calling 1-888-845-5669. Beware of businesses that promise to reduce your debt or make settlement on your behalf that charge for their services. While some of these businesses are legitimate, many are not. It may be a good idea to check with the Better Business Bureau before you spend money on service providers that make promises that are too good to be true!

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