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The Empty Promise of Mortgage Modification

Why aren't Georgia lenders modifying mortgages?

Foreclosures harm more than the homeowners they evict. A foreclosure can drive down the property values throughout an entire neighborhood. As a result, homeowners could find themselves "underwater," with a home worth less than is owed on the mortgage.

When desperate homeowners shed their mortgages through short sales or simply by walking away, property values may drop even further. Over time, foreclosure damage can turn an ideal neighborhood into a depressed zone where property falls into disrepair and vandalism thrives. Because of the devastating consequences to unchecked foreclosure, Congress passed legislation aimed at stimulating the practice of modifying home loans. But while the intentions of such laws were positive, the results have been lackluster at best. Lenders have simply not been willing to modify enough mortgages to make a real difference.

So what's the hold up with mortgage modifications?

Given the damage foreclosures can do, it seems logical that the mortgage industry would embrace a potential remedy. Yet, it's nearly impossible to get a mortgage modification anywhere in the Atlanta area. Why aren't lenders cooperating? In a nutshell, lenders aren't doing mortgage modifications in Georgia because they have no financial incentive to do so.

  • The foreclosure process is long and delays the point at which the lender has to declare a loss — and since so many lenders are carrying so many bad loans on their books, this delay can be valuable.
  • Modifying a mortgage costs the lender more than the foreclosure process.
  • Lenders make more money from late fees and other charges then they do from on-time payments.
  • The incentives the government paid the banks to modify mortgages came with no strings attached. There were no provisions that required lenders to modify loans.

Contact DebtStoppers today for an alternative to mortgage modification that actually works!

As in most cities, Atlanta mortgage modifications are few and far between. If you want to stop foreclosure and save your Atlanta home, fill out our free personal debt analysis form and learn if a DebtStoppers bankruptcy plan is an option for your family. Call us at 404-796-7161 or contact us online for a free one-on-one debt consultation with an experienced attorney.