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More debt relief may soon be on the way for Chattanooga residents

As many Chattanooga, Tennessee, residents know, the past few years have not been an easy time for those trying to pay off a mortgage. Debt relief by way of additional income has come rarely, as consumers and homeowners have been facing financial challenges, and it seems like the banks who loan these people money have been largely unable or unwilling to help a distressed borrower.

For many homeowners, this is now changing. As previously discussed on this blog a few weeks ago, many residents have been receiving help from the last massive settlement with some banks, including Bank of America, that were accused of mortgage fraud. There is now another case targeting Bank of America. The federal government filed this suit because Fannie Mae and Freddie Mac were forced to take huge losses because of the poor practices by both the bank and mortgage servicer Countrywide from 2007 through 2009.

As of right now, it is unknown how this case can help homeowners who are struggling with a repayment plan, want to eliminate debt or simply want to prevent foreclosure. However, since the previous case involved such a huge settlement, it is not out of the question for Bank of America to be forced to help the homeowners who are facing financial challenges find some debt relief.

At the moment however, it may be too soon to tell what kind of help, if any, homeowners will be able to get from this case. For anyone who has a mortgage with Bank of America, however, it is certainly worth watching to see what happens next and what type of help can be expected in the future. Those who financially are unable to wait while this case goes through the court system may want to consider bankruptcy as an alternative debt relief option.

Source: Los Angeles Times, "Feds sue BofA for $1 billion over loans sold to Fannie, Freddie," E. Scott Reckard, Oct. 24, 2012

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Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-954-7180
Phone: 423-624-4002
Fax: 423-624-0509
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