Free Clinic in San Diego Gives Homeowners Mortgage Advice

Approximately 300 people attended the event held by the Housing Opportunities Collaborative and the Legal Aid Society of San Diego.

More and more homeowners are finding themselves unable to pay their mortgages. According to Tom Rockwood, a resident in California “Our payments went from $1,200 a month to $2,000 a month.” “We have the option to pay the mortgage and don’t pay for any of the utilities, gas, or food.” Mortgage counselors at these meetings have been able to help people like Tom Rockwood negotiate with their lenders by changing their monthly payments or extending the time period for their loan.

John Brady, an attorney at the clinic, explained to home owners that once you have your house foreclosed on the difference between what you owe and the lender’s loss is considered by the IRS as income and you could get taxed 40% of it. For people who owe far more than your home is worth Brady recommends Chapter 7 bankruptcy so you can get out of debt and have a fresh start. For people in better financial situation he said he recommends Chapter 13 bankruptcy, which allows homeowners to keep their home and work out a debt repayment plan.

The next mortgage clinic will be held in the East County next month.