Leading Bankruptcy Firm Says Bush's Stimulus Package May Not Solve Colorado's Sub-prime Lending Fallout

One of Denver's leading bankruptcy law firms, The Aschenberg Law Group, P.C., says the predicted relief from President Bush's economic stimulus package may not be enough to provide long-term help for Coloradoans caught in the sub-prime lending crisis. However, a newer trend in bankruptcy law that removes second and third mortgages is helping provide solutions to homeowners in the Front Range right now.

The Federal Government has stepped in to allow adjustable rate mortgages to be refinanced or to delay the increase in rates, but many experts suggest that too much government intervention into private sector lending may make it worse by driving up long-term interest rates, so further mortgage help may not come from the government. For some families, the promised economic stimulus package and its cash rebate may help with short-term financial needs, but many will remain in a house they cannot pay for that is not worth the value currently owed on it.

Jesse Aschenberg, lead attorney for The Aschenberg Law Group, says there is a little-known process in bankruptcy law that can provide relief for homeowners in such a situation. This newer provision allows for the removal of a second mortgage if the mortgage is fully unsecured.

"This new trend in bankruptcy law has generated a hopeful solution for homeowners across the Front Range," says Aschenberg. "While the mortgage fallout continues to be a driving issue, we are hoping to utilize this new provision to help more Colorado homeowners in crisis." Aschenberg notes that the impact of this new trend on the already damaged mortgage industry remains to be seen, but for beleaguered homeowners, the news is welcome.

The Tenth Circuit United States Bankruptcy Appellate Panel issued a ruling in December 2005 clarifying that second and third mortgages that are wholly unsecured can indeed be stripped off in a Chapter 13 bankruptcy -- leaving homeowners with only the first mortgage to pay on the house.

The Aschenberg Law Group, P.C., represents debtors in Chapter 7 and Chapter 13 bankruptcies and serves clients all along the Front Range.

Please call Dindi Wade at (720) 493-9733 or (866) 493-9733 or e-mail at: dwade@debtreliefcolorado.com to schedule an interview with Jesse Aschenberg, J.D.

The Aschenberg Law Group, P.C., is a debt relief agency that helps Colorado residents file for relief under the Bankruptcy Code.

Contact: Dindi Wade

P: (720) 493-9733 or (800) 493-9733