I get this question all the time: How can I take advantage of the mortgage
modification bill going through Congres right now?
My first answer is a caveat: We have no idea what the final bill will look
like (or if it will even pass), so any action we take right now is speculative.
With that caveat in mind, however, we do know that there are several pre-filing
requirements that will probably be in the mortgage modification bill.
There are two pre-filing prerequisites under the current bill: (1) the
debtor must have requested a loan modification from the lender at least
15 days before filing (unless the filing is within 30 days of a foreclosure
sale) and (2) the debtor must have received a notice that a foreclosure
may be commenced. The first is easy and most of my clients have done this
on their own before they ever come to see me. The second is a little more
complicated because (depending on what this means), debtors would likely
have to get behind on their mortgage payments to make this an option.
Some people have suggested that this could refer to the original deed
of trust, but I don’t think I would rely upon that. However, a letter
mentioning foreclosure should be sufficient. That being said, I would
not advise a client to do anything that might result in them getting a
foreclosure notice until after this bill has been signed, because we still
do not know (1) whether the bill will be signed and (2) what provisions
will be in the final bill.