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When HAMP Fails

Millions of American debtors are struggling to make ends meet. Burdened with a mortgage they cannot service and a house they cannot reasonably sell, many debtors have become delinquent on their home loans. In fact, just a few years ago, the Mortgage Bankers Association (MBA) announced that the delinquency rate had reached 15 percent.


In an attempt to respond to these concerns, the U.S. Treasury Department launched the Home Affordable Modification Program (HAMP). Despite the program’s noble goals, many observers believe HAMP has been a programmatic failure. Primarily, HAMP resulted in a little over half a million mortgage modifications, rather than the 3 or 4 million modifications originally predicted.


The idea of home loan modifications is a good one, even if HAMP proved to be the wrong approach for many families. So, what should you do when HAMP fails? Many bankruptcy courts have stepped into the breach, bringing together creditors and debtors in an attempt to foster dialogue and resolve the financial impasse. Although foreclosure is sometimes still the outcome, in a large number of situations, these court-sponsored workouts have enriched the creditor and let the debtor keep his home.


Working out your financial difficulties is important. Whether it requires a formal bankruptcy filing or not, the professionals and dedicated attorneys at the law firm of Fears Nachawati know how to ask the right questions and drive to the best solution for you and your family. If you’re struggling to meet your obligations – and, in particular, your mortgage payment – it may be time to speak with our staff. Talk to us today.


When HAMP Fails