Mortgage companies will charge you many fees and request extensive amounts of documentation through their Loss Mitigation Departments. They will make you believe that they want a loan workout, eventually they will have you pay half of your arrears up front, and the rest within 6 months, in addition with your regular payment.
Mortgage companies will not try and work with you until there is a foreclosure judgment. By that time, you will have accumulated attorney fees, court fees and Sheriff’s cost.
If you file a Chapter 13 early in this process, you will save money on potential legal fees and help increase you credit scores, all the while the Chapter 13 will stay the foreclosure proceeding. Bankruptcy laws have been established to give you an opportunity to start fresh and improve your credit history. You will be astounded by the increase of your credit score after filing bankruptcy, all because you eliminated your debt.