Doesn’t seem to be a good option. You can’t get a mortgage mod in bankruptcy. She couldn’t afford the $1450 anyway, so she would be no better off and would still lose the house. The article didn’t say what city she lived in but the fact that the bank hasn’t foreclosed is telling. Normally if there was a market for the house she would have been foreclosed on within 9 months or less. In some places the banks don’t foreclose because they don’t want to pay the back taxes, ie Buffalo. They may never foreclose on the place. In other instances her mortgage is part of a pool that comprises a mortgage backed security. There’s a servicer who’s supposed to handle this, but if a large portion of the pool went bust, there might not be the funds to foreclose out the non-performers. And they may not be paying the taxes either which means the property will eventually go in a tax foreclosure sale, which means the mortgage will be cancelled out anyway. So the point is she needs a real lawyer to advise her, not some scam adviser telling her to just stop paying and hope for the best.
Not so. It does happen often. During and after.
At least you can take part of the process. There ain't many mods going permanent, and many that do continue to be daily battles with the banks. But that's a different topic.