Foreclosure and tax liens

[sambo427]

I have some really good friends which are also neighbors that I am concerned about.
I wanted to get another opinion regarding their options.
1. They are 5-6 months behind on their mortgage
2. There is no equity in the house
3. They have a 60K tax lien on their name/property
4. They owe 5K in property taxes
5. Their bank account was levied last week for tax debt.

What are their options? They are thinking that WAMU will take their past due payments and put them on the rear of the loan and drop their rate to about a 6.25% from a 11% in order for them to keep the house. My husband and I are thinking there is no way the mortgage company will do that. But what do you think?
Oh, by the way, they filed bankruptcy in 2000, so I do not think that is a option.....?????

[chpxiii]

Oh, by the way, they filed bankruptcy in 2000, so I do not think that is a option.....?????

If it was Chapter 7, I think they may be eligible again in 2008. But if so, they may want to take a look at why they are having to file again.

[HHM]

That is probably wishful thinking on the loan. They may be move the missed payments to the back end...but such a substantial reduction in interest rate is not likely.