Don’t mistake this practice as something that is just between the banks or loan servicers and homeowner. Realize that all parties need to play a part in order to avoid lawsuits. Thus the real point of contention is will the investors allow this. Also trying to recast a single mortgage when it may be chopped into bacon bits and sprinkled throughout several other obligations seems to be quite unrealistic to me. Yet make no mistakes I have heard of them successfully being recast but I don’t have details of any of them such as how unpaid fines, and other issues were indeed resolved.
As far as the property taxes go there really is not any correlation. The assessment that the county makes on your home is somewhat orthogonal to what you owe a lender. Don’t confuse the two. Your assessment is based on what the county thinks your home is worth and it is up to you to change the assessment by proving the devaluation of your home based on comps. If you are someone who has had a reworked loan I am sure providing the county that information will help your reassessment but you will still most likely need comps from other homes which shouldn’t be to hard to find.
Kewp – In theory there really is no difference in this practice or the bank letting the home go to foreclosure and selling it as an REO. In practice though, my OPINION which is not worth much is that I bet the recidivisim (sorry for butchering the word) is most likely high even after the loan workout.
