Self Employed and Denied a MHA HAMP Loan?

iStock_000015861187XSmall.jpgAs most of us know by now, while it may appear easy to apply for a loan modification under the Making Home Affordable (MHA) Home Affordable Modification Program (HAMP), it's not so easy to get approved for an MHA HAMP loan--especially if you are self-employed. From my experience, at the Law Office of Linda C. Garrett, California a HAMP mortgage, bankruptcy and family-law practice, I have spoken with many self-employed person who was denied a MHA HAMP loan modification. While tempting to blame the lender/servicer, many times, the problem lies also with the borrower for failing to submit proper documentation for his/her business. The documentation needed for self-employed individuals is not the same as the documentation needed for wage earners. Additional documents are required.

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Can Two Creditors Garnish Up to 50% of Your Take-Home Pay?

iStock_000007320537XSmall.jpgUsually, when a person is sued by a creditor or is served with a garnishment order, a debtor/employee's first recourse is to contact a bankruptcy attorney, requesting that the attorney file a Chapter 7 or Chapter 13 bankruptcy petition on their behalf. While bankruptcy, is no doubt, an efficient and effective means of eliminating a wage-garnishment order, it's not always a feasible option. As I stated in "What Are All My Options For Dealing With my Overwhelming Debt?" blog post, one-size does not fit all. Specifically, there are many reasons a debtor-employee would not wish to file bankruptcy. For example, the employee-debtor has no other debt or is judgment proof. It may surprise many readers to learn that sometimes, challenging a wage-garnishment is better than filing bankruptcy, especially if they are able to challenge a wage-garnishment order--and win; or, challenge a wage-garnishment order and pay but a small fraction of the original wage-garnishment order amount. The next question is this: if a second judgment-creditor attempts to garnish an employee-debtor's wages, is it time for the debtor-employee to file bankruptcy--for fear the second creditor will also seek an additional 25% of the employee-debtor's take home pay, for a total of 50%?

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Top 11 Most Common Mistakes Homeowners Make When Applying for a MHA HAMP Loan Modification

iStock.loandenial.jpgEven now, three years after the Obama Administration introduced the Making Home Affordable Program (MHA) in February 2009 and the first program under the MHA intended to prevent foreclosure, the Home Affordable Modification Program (MHA HAMP) still continues to be plagued with problems, resulting in lenders and loan servicers continuing to deny loan modifications to otherwise eligible borrowers. To make matters worse, the conduct of the distressed homeowner (or lack thereof) significantly increases the chances that their MHA HAMP loan application will be denied.

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"Help!, the Sheriff Just Levied My Bank Account!"

iStock_000005871379XSmall.jpgThe inspiration for this post comes from a call I received today. The distressed caller stated that a "bottom feeder" creditor "stole" my money from my bank account. After a few minutes of talking to this prospective client, it became clear to me that she knew nothing about her legal rights. She also reminded me that knowledge is power--because, had she had a little knowledge about her legal rights, she could have reversed and stopped the sheriff's bank levy.

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"Why Won't My Lender Give Me A Principal Reduction For My Underwater House?"

imagesCAS7XN4N.jpgAt the Law Office of Linda C. Garrett, an virtual online law office, providing full-scope and limited-scope legal services in the practice areas of consumer law, mortages (HAMP), bankruptcy and family law (to include unbundled legal services), I receive many calls from frustrated homeowners sharing with me that their "lender" refused to extend a principal reduction to them at the time their lender approved their loan modification. No doubt, this is frustrating, especially for California homeowners, since a majority of California homeowner's homes are severely underwater. So what is a California homeowner to do when their lender has denied them a principal reduction?

Before I go further, let me discuss some basics about the Principal Reduction Alternative Program ("PRA"):

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"What Are All My Options For Dealing With My Overwhelming Debt?"

Thumbnail image for Thumbnail image for question-mark[1].jpgThe inspiration for my blogs come from many sources--reading questions asked on various websites--from callers at the Law Office of Linda C. Garrett, an online virtual law office, providing full-scope and limited-scope legal services in the practice areas of consumer law, mortgages (HAMP), bankruptcy and family-law; and, from other sources. A common question, to which there is a plethora of information, is what are a debtor's options when they have mounting consuming debts? Of course, a debtor has options. The problem, however, is this: what options are right for them! Just as each person is different, so are the options available to them. Let's explore these options.

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"My Wages Were Just Garnished! Is Filing Bankruptcy The Only Way To Stop My Wages From Being Garnished?"

iStock_000017413305XSmall.jpgAt the Law Office of Linda C. Garrett, a virtual online law office, providing full-scope and limited-scope legal services in the practice areas of consumer law, bankruptcy, mortgage (HAMP) and family law, I receive about one to two calls per month about wage-garnishment issues. The next statement that usually comes out of the prospective client's mouth, after they have informed me that they just learned their wages were garnished, is, "what's the soonest I can file bankruptcy?" As all my clients know, I only recommend bankruptcy when it is necessary. For me, bankruptcy is necessary only when the person has no other option to stop the garnishment. For many individuals, they are surprised to learn that they can stop the wage garnishment without filing bankruptcy. It is possible? Yes, it is!

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"What Exactly Is A Deed In Lieu of Foreclosure And Is It Right For Me?"

iStock_000007577163XSmall.jpgWhether a deed-in-lieu of foreclosure is right for your California-based distressed residential property depends on many factors. Don't listen to anyone who tells you "you should do I deed-in-lieu of foreclosure, because I did" As with anything, it is important that you carefully weigh the pros and cons of your situation, based on your unique set of facts and circumstances, before deciding on any one option as it relates to your distressed mortgage. For many, a strategic foreclosure is their best option, for others, a short-sale, and for others a deed-in-lieu of foreclosure . . . assuming it is available by the borrower's lender. How can you determine if a deed in lieu of foreclosure ("DIL") is right for you?

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"How Do I Know If Debt Settlement Is Right For Me?"

images[10].jpgAt the Law Office of Linda C. Garrett, an online virtual online law office, providing full-scope and limited-scope legal services in the practice areas of consumer law, mortgage law, bankruptcy law and family law, to include unbundled legal services, I have talked with many consumers, fearful and confused about the concept of debt settlement. Many people, including lawyers, have strong opinions about debt settlement. On the one hand, consumers are told "don't do it, just file bankruptcy and get a fresh start," or, on the other end of the spectrum they are told, "It's great because if you can negotiate a good settlement, you can avoid filing bankruptcy--which is less harmful to your credit score and not as expensive as filing bankruptcy."

The purpose of this blog post is to discuss the pros and cons of debt settlement.

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"Is Short-Selling My California Home Right For Me?

iStock_000020073288XSmall.jpgDue to the recession and its consequential adverse effects on mortgaged properties, many state laws and federal programs have been enacted and created to provide much-needed relief to homeowners with distressed mortgages. The problem, however, is that it is difficult for any one person to keep up with the changes in laws and government-sponsored programs--as they seem to be changing almost monthly! Even attorneys are finding it challenging these days to keep current on the quickly-changing and constantly-evolving laws and programs relating to distressed mortgages. For example, does a California homeowner need assistance from the federal government to short-sale their home? And, asking the bigger question, does a California homeowner need to short-sale their home to begin with?

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"What Does the Term 'Judgment Proof' Really Mean and Should I File Bankruptcy if I am Judgment-Proof?"

images[9].jpgBy 2008, resulting from the drecession, I was receiving approximately, 20 calls per month from individuals requesting that I file a Chapter 7 or Chapter 13 bankruptcy on their behalf because they were, amongst other things, being harassed by their creditors. At the Law Office of Linda C. Garrett, an online virtual law office, providing full-scope and limited-scope legal services in the practice areas of consumer law, mortgage and HAMP law, bankruptcy law and family law (to include unbundled legal services), I always caution my clients against making bankruptcy their first option--and instead, ask that they consider it their last option.

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Consumer Financial Protection Bureau


What is the Consumer Financial Protection Bureau and why it may be important to you if you have a mortgage, credit card and/or student loans.

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"What Does The $25 Billion Mortgage Settlement Mean To Me?"

The $25 Billion Foreclosure Settlement

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What does it mean to you; and, are you included in the settlement?

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"What Exactly Is a Creditor Lawsuit and Do I Have Options Besides Bankruptcy?"

iStock_000018620563XSmall.jpgAt the Law Office of Linda C. Garrett, a Solano County, California-based Consumer, Bankruptcy and Family-law practice, I receive many calls from distressed individuals regarding creditor lawsuits--pending and completed. The typical caller usually calls me a day or two after having been personally served with a Summons and Complaint from their creditor or after receiving a wage-garnishment order or notice of bank levy. My caller is usually in a panic and fearful that the creditor will garnish his wages and/or levy his bank accounts.

The purpose of this Blog Post is to educate the reader that not only do they have many legal rights, but many options as well!

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Denied a MHA HAMP Loan Because of the NPV Test? The "Fat Lady" Hasn't Finished Singing!

Thumbnail image for iStock_000015861187XSmall.jpgAt the Law Office of Linda C. Garrett, an online, Solano County, California-based Consumer, Bankruptcy and Family law practice, I receive several calls per month from distressed homeowners informing me that their home is in foreclosure (or they are considering short-sale) because they do not, per their loan servicer, qualify for a loan modification through the Making Home Affordable Home Affordability Modification Program ("HAMP"). Many times, the letter they receive from their servicer does not give an explanation for the denial. If their loan servicer does give a reason, many times it is to state that their loan modification application failed the "NPV" test.

What are NPV tests; Are they Important; and, Can They be Challenged?

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