Homeowners with Bank of America who are seeking bankruptcy prevention assistance or who may feel that bankruptcy is their only option are being urged to look into the total opportunities available to them as simple modifications may not be the only way a homeowner can find more affordability on their mortgage payment or foreclosure prevention, despite the fact that Bank of America did see increases in the number of bankruptcies that were in process or have been processed for homeowners whose trial modification was either canceled or denied upon applying.
Data from the Treasury Department indicates that homeowners with Bank of America whose trial modification was canceled saw an increase in the number of bankruptcies between June and July as this program total increased from 7,995 to 8,121. Furthermore, homeowners who are accepted for a trial modification saw increases in bankruptcies from 13,184 to 15,410. Obviously, bankruptcy is one of the extreme measures that some homeowners have to take when they feel that they can no longer afford not only their mortgage payment but also financial distress that may be present in their lives. However, homeowners are still in a position where there are plans that may go beyond modifications to help their financial problems.
In cases where homeowners are struggling with other debts, opportunities for assistance through credit counseling agencies or direct intervention from their creditors can help homeowners avoid excessive debt obligations on credit cards, loans, or other forms of debt but also when these plans are used alongside modifications, homeowners may find that more affordability is found in their financial life and such extremes like bankruptcy will not be necessary. Homeowners may also be able to participate in alternatives like a short sale, as bankruptcy or foreclosure will definitely do a great deal of damage to a homeowner’s credit score, and obviously if continued struggles to meet certain debt obligations are present in the life of a homeowner, this will also do damage to their rating as well.
Understandably, not all homeowners have success when certain programs like modifications are offered from banks such as Bank of America, but when a homeowner pursues mortgage assistance plans that may go beyond a traditional modification, as well as help they can be available from creditors outside of the mortgage servicer, this could help these financially troubled individuals to find relief in their life to the point where filing bankruptcy, as an example, can be more easily avoided or homeowners who may face the loss of their home could potentially participate in an alternative, such as a short sale, and also avoid missing payments on unsecured debts or other obligations, which again could be a setback in their financial life.
However, financial counselors often point out that for homeowners who feel that bankruptcy may be a possibility that needs to be considered, it will be important to address these financial problems early so that financial institutions like Bank of America can get the modification process rolling or other avenues of financial assistance on a home loan can be better explored, and homeowners may stand a better chance at getting help for certain debts if they address problems before missed payments occur.