Which Las Vegas home foreclosure category are you in? | Haines & Krieger

In the eyes of mortgage lenders and banks, there are three categories for homeowners facing foreclosure, according to an article in the Washington Post (“Foreclosures are Often in Lenders’ Best Interest“).  And only one of those categories is viewed by mortgage companies as good candidates for loan modification.

Foreclosure Category 1:
You can’t keep up payments without the loan modification, but you could keep up payments with a loan modification.  This is the category for which it’s likely to be in a mortgage lender’s interest to negotiate a loan modification.

Foreclosure Category 2: You could keep up with payments if you got a loan modification, but you’re likely to fall behind down the road, leading to foreclosure.  Mortgage lenders want to try and avoid giving loan modifications to people in this category, according to the article.

Foreclosure Category 3:
You’re behind on payments, but if you really bust your you-know-what, sell your car, take a second or third job, borrow money from friends or relatives and do whatever else it takes, you could make your payments.  People in this category are probably the ones who could most benefit from a loan modification.  But if you’re able to get blood from a stone on behalf of the mortgage lender, then according to the article, they don’t have incentive to offer you one.

Bear in mind that these categories represent the interest of the mortgage lender, a private, profit-driven company.  They do not, however, necessarily represent the best interests of society as a whole or of the economy.  It’s more beneficial to our Las Vegas society to have people in stable living situations.  And it’s more beneficial to our Las Vegas economy to have people in stable financial situations so that they can continue to be productive members of society.

That said, it’s important for Las Vegas residents to be aware of these three categories.  Because that’s how the mortgage lenders see if you if you’re facing foreclosure in Las Vegas.

Also, I want to point out that categories are not hard science.  While some people may clearly fall into Foreclosure Category 1 or Foreclosure Category 2, how can you really know if someone is in Foreclosure Category 3?  You have to imagine there’s a lot of guess-work that goes into figuring out whether a homeowner falls into Foreclosure Category 1 or Foreclosure Category 3.

For that reason, when you’re considering loan modification in Las Vegas, it can be extremely helpful to have experienced loan modification lawyers on your side who know how to:

  • evaluate your foreclosure situation
  • come up with an optimal, customized strategy for you
  • get the mortgage lender to attend a mandatory foreclosure mediation sessions (if necessary)
  • communicate effectively with the mortgage lenders
  • present your story in the most favorable way on your behalf, and
  • negotiate with the mortgage lenders on your behalf.

Contact us for a free initial loan modification consultation.  We’ll quickly help you figure out your best options, whether that means loan modification in Las Vegas, bankruptcy help Las Vegas, or even a combination of the two.  And we’ll make sure you get the full benefit of the new bankruptcy laws Las Vegas.