Mortgage aid programs help distressed homeowners

Despite the fact that nationwide statistics show that foreclosure rates are falling, many Connecticut residents are struggling to stay in their homes. In some Connecticut cities, foreclosure rates are actually increasing. Experts opine that Connecticut’s high unemployment rate, a rate that is still at 9 percent, contributes to the state’s high rate of foreclosures.

Many Connecticut residents, especially those in New Haven and Brideport – cities that were hit hardest with foreclosures – m may be in need of some mortgage assistance. Major banks, including Citigroup and Bank of America, are working with the Connecticut Department of Banking to help distressed homeowners. They have created events during which bank representatives sit down with homeowners and see if they can formulate plans to keep them in their homes. Options that are discussed at these mortgage assistance events include:

  • Interest rate reductions
  • Mortgage modifications
  • Principal reductions
  • Short sales

Mortgage assistance events and workshops have been popping up throughout the state. Whether or not a homeowner can actually get relief through one of these workshops is debatable. The homeowner, however, may receive some knowledge and awareness about his or her options and the process. The more knowledgeable and prepared the homeowner is; the less likely it is that he or she will lose his or her home in a foreclosure.

Connecticut foreclosure process

Connecticut is a judicial foreclosure state. This means that a lender has to file a lawsuit and a judge will decide whether or not to grant a “strict foreclosure” or a “foreclosure by sale.”

  • Strict foreclosure. In a strict foreclosure, the court sets a date by which the homeowner must pay the mortgage. If the homeowner fails to pay, the court awards ownership of the home to the lender with no auction taking place.
  • Foreclosure by sale. In a foreclosure by sale, the court orders the home to be auctioned to the highest bidder with the lender placing the first, or opening, bid. These auctions are commonly referred to as sheriff sales. The lender may sue the homeowner to obtain a deficiency judgment. This is the difference between the amount owed and the amount the home was sold for.

If you are struggling with your mortgage, contact an experienced foreclosure law attorney to learn more about your rights and your options. You may be able to prevent the loss of your home by foreclosure through a variety of methods, including:

  • Filing pleadings to slow down the foreclosure action
  • Negotiating loan modifications
  • Refinancing the mortgage
  • Reducing the mortgage payment to reflect current earnings and ability to pay
  • Selling the property through a short sale.

Banks do not want to foreclose on your property. In most cases, they want to help you. An attorney who has experience with all aspects of foreclosure law will know how to navigate the process and negotiate with banks. He or she can be your best asset when trying to save your home.

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