Do you feel trapped in your home because you now owe more than the house is worth? Did you buy a rental property as an investment only to see the value of your property plummet in the real estate crash? Are you struggling to make mortgage payments and just wish you could walk away?
A strategic default is a process that begins with a decision by a property owner to walk away from his mortgage. The most common reason for a strategic default is that the value of the property has dropped below the amount owed on the mortgage. This is referred to as "negative equity" or being "underwater." Faced with negative equity, many homeowners rationally conclude that they will be better off financially in the long run if they choose to walk away from their mortgages.
The decision to strategically default can also be influenced by other financial considerations, such as job loss, reduction in income, or the need to move to a different city or state. Owners of rental properties often consider a strategic default when it becomes too difficult to rent the property or the rental income is no longer sufficient to generate a positive monthly cash flow.
As of March 2013, Illinois ranks sixth in Nation for underwater mortgages. Presently, more than 25% of all households with mortgages in the U.S. owe more than their homes are worth. It is estimated that over one million homeowners who could afford to pay their home loans will walk away from their mortgages this year alone. In Chicago alone, over 33.3% of all houses with mortgages are underwater. Mortgage payments on underwater mortgages may also be draining other financial resources. Unemployed homeowners tap into their retirement plans to make mortgage payments. Savings accounts are wiped out as homeowners try to keep their heads above water.
With many homeowners crunching the numbers and deciding to walk away, the term strategic default has become a common means of freeing financial resources from the binds of paying on a mortgage with negative equity. Despite being once considered taboo, choosing to default on a mortgage has become increasingly more common and, for many homeowners, considered to be the smart choice, particularly as American consumers become increasingly aware that banks and lenders are not taking steps to help families and property owners keep their homes.
Anyone who has attempted to apply for a mortgage modification or conduct a short sale knows how difficult it is to deal with most banks and loan servicers. More Americans are becoming angry that these banks have taken billions of dollars in taxpayer bailouts, only to use that money to forcibly remove hundreds of thousands of Americans from their homes.
Many families have come to the realization that there will be no bailouts for the American homeowner struggling to make mortgage payments. No one is coming to save them. Many feel abandoned by their banks and with seeming little government intervention on their behalf. If you feel this way, you are not alone. And you are right. But you have the means to fight back. You have the ability to unshackle yourself and walk away.
If done correctly, with full knowledge of the potential risks and benefits, a strategic default can be the right choice for many property owners. Call Illinois Foreclosure Lawyer Daniel S. Khwaja today to discuss whether a strategic mortgage default is your best option. Attorney Khwaja will explain in detail your rights and options as a property owner.
If you are considering walking away from your mortgage, either because you can no longer afford to pay your mortgage payments or because it no longer makes financial sense for you to continue paying on a mortgage when you owe more than the property is worth, Attorney Khwaja will explain the benefits and risks to you. Illinois Foreclosure Attorney Daniel S. Khwaja will give you the information you need to make an informed decision about your financial future.
What can Illinois Foreclosure Lawyer Daniel S. Khwaja do to help families who are about to lose their homes? There are two ways to help, depending on the situation.
1. We can help families get loan modifications and ultimately stay in their homes.
2. We can actively fight the foreclosure, forcing the bank to "prove" the merits of their case.
*Fees listed are in US Dollars ($) and exclude applicable and separate court filings fees, etc. | Flexible payment options available.
Illinois foreclosure attorney Daniel Khwaja wants people facing foreclosure to know they have options. The biggest misconception is that they cannot afford a lawyer; however, Mr. Khwaja offers very affordable rates.
During the FREE initial consultation, he outlines several options including the "Cash for Keys" program, loan modification, and the required "hard proof" lenders MUST have to attempt foreclosing.
Contact Daniel S. Khwaja, Esq. for a free Foreclosure case evaluation.
Daniel S. Khwaja