Homeownership can give a person a sense of security, that is until the mortgage debt becomes too much to handle. When purchasing a home, it may seem affordable at the time, but life changes can quickly turn that affordable payment into a significant liability. Michigan residents who are struggling to pay their mortgage debt have a few options to improve their situations. Filing for Chapter 13 with the assistance of a bankruptcy law attorney, for example, can help one achieve a truly affordable repayment plan.
On June 27, 2019, a report regarding the amount of mortgage debt in each state was published. Michigan ranks 42nd in the nation for highest mortgage debt. Here are the 2017 census numbers cited in the article:
- Median income: $54,909
- Mean mortgage debt: $135,240
- Average home value: $155,700
- Rate of home ownership: 71.3%
- Percentage of homeowners with mortgage payments: 60.2%
The amount homeowners in Michigan hold in mortgage debt is low compared to the rest of the country. Still, when job loss occurs, illness takes hold, emergency expenses arise, managing the debt may seem impossible. Mortgage lenders will only allow homeowners to go so long without payment before threatening foreclosure. Those who do not want to lose their homes will need to take swift action to stop the foreclosure process.
There are those who may be able to work out agreeable terms with their banks to halt the foreclosure process. There are others, though, who will find themselves unsuccessful at doing so. Once a bankruptcy law petition is filed, creditors — including mortgage lenders — have to stop all efforts to collect or foreclose on property until the bankruptcy case is closed or the court orders otherwise. If a Chapter 13 petition receives approval, a new payment schedule that fits one’s current monetary restraints will be created and put into action. While going this route may not be ideal or even necessary for some, for others, it is the best option if they wish to keep ownership of their homes.