New Jersey Loss Mitigation Attorney
Helping NJ Clients save their homes and Reduce Mortgage Payments
In recognition of the mounting number of foreclosures on residential and commercial properties in the current unstable economy, the United States Bankruptcy Court for the District of New Jersey adopted a Loss Mitigation Program which became effective on August 1, 2011.
The Loss Mitigation Program is designed to function as a forum for debtors and lenders to reach a consensual resolution when a debtors residential property is at risk of foreclosure. The program aims to facilitate such a resolution by opening and maintaining the lines of communication between the debtors and lenders. The Loss Mitigation Program encourages the parties to finalize a feasible and beneficial agreement with the assistance and supervision of the Bankruptcy Court.
Loss mitigation is intended to describe the full range of solutions that may avert the loss of a debtor’s property to foreclosure, increased costs to the lender, or both, and may include loan modification, loan refinance, forbearance, short sale, surrender of the property in full satisfaction, or some combination of these agreements.
The Loss Mitigation Program
Any individual or joint debtor filing for relief under Chapter 7, 11, 12 or 13 of the Bankruptcy Code is eligible to participate in the Loss Mitigation Program, provided that they possess real property or a cooperative apartment that is used as a principal residence.
At the beginning of the loss mitigation process, the Loss Mitigation Parties should discuss the following:
- The time and method for conducting the loss mitigation sessions
- The types of loss mitigation solutions under consideration by each party
- A plan for the exchange of required information prior to the loss mitigation session, including the due date for the debtor to complete and return any information request or loss mitigation paperwork that each creditor may require.
At any time during the loss mitigation period, a Loss Mitigation Party may request a settlement conference or status conference with the Bankruptcy Court. They may also request an extension of the loss mitigation period. If a party does not consent, the Bankruptcy Court will schedule a hearing to consider whether further loss mitigation sessions are likely to be successful.
To ensure that the process proceeds in a timely manner, the Loss Mitigation Parties are required to provide the Bankruptcy Court with status reports according to the time set by the Bankruptcy Court in the Loss Mitigation Order. The Loss Mitigation Parties must seek Bankruptcy Court approval for any resolution or settlement reached during this loss mitigation.
Contact The Radol Law Firm
The filing for Loss Mitigation is extremely time sensitive since a debtor seeking to commence the Loss Mitigation Program must file papers in less than thirty days from the date of filing for bankruptcy. Upon requesting for such assistance, the court will enter an Order establishing a schedule for Loss Mitigation. Therefore, it is extremely important to hire an attorney with the full knowledge and experience. Contact The Radol Law Firm for a consultation to discuss your legal matter.