Foreclosure Grain of Sense
You cannot get the death penalty for being behind on your mortgage, or go to jail but you are not going to “win” a free house either. Foreclosure defense is not about winning; it is about mitigation, which is not losing as badly as you could.
Sometimes a foreclosure defense is about a short sale, and sometimes it is about a modification. Foreclosure defense is always about lessening the credit hit as much as possible…and putting the homeowner in the best possible position to be a homeowner again…even if that means having to wait for credit repair. A 2-3 year wait in some areas might actually make sense since some areas are still dropping in value with no end in sight.
Many borrows do not realize that their modification and their foreclosure are moving ahead at full steam on parallel tracks. The lending department and the legal department at their bank are not going to run into each other at the water cooler. They are not going to call each other, email, text, IM, or exchange a Facebook discourse about the file. The borrower continues to work with the lending negotiator on a modification, while the legal department continues with the foreclosure. The modification package and the Notice of Default or Notice of Sale can arrive the same day.
A foreclosure defense stalls the legal action, and allows the borrower to pursue that modification or short sale. A foreclosure defense is about harvesting the best possible outcome from a bad crop of circumstances. Most banks actually would prefer a short sale over a foreclosure and if they are honest a modification too. The famed NPV test simply determines whether they would make more money off of a foreclosure vs a modification. They will Always make more money with a short sale but you just need to the right team on your side helping the lender make the right decision.