Sunday, July 29, 2007
Often, you can avoid foreclosure through difficult work and not by sitting back and giving up. Here are particular steps that could help you get financial assistance to stop foreclosure.
Never ignore letters or phone calls regarding your delinquent mortgage bills. Contact the lender and explain your situation, as they may be able to work with you and know that you are really trying to make things right so offer you financial help to stop foreclosure. You may not qualify for aid if you abandon your piece of real estate so remain in your house.
When you work with the lender and your financial problems are temporary, the lender might be able to help with financial help to stop foreclosure. Often this is an one time loan, bringing your financial payments up to date.
Often a person can either extend the loan or refinance to stop foreclosure when interest payments are too high. The upside is that the monthly interest payments are smaller but the lender interest rates are higher. This could allow you to catch up on missed loan payments. Always be honest and upfront with the lender and they will work with you.
After examining your monetary position and the reason for your nonpayment, the lender could diminish the monthly payment or suspend payments temporarily.
Nobody wants to lose his or her home or have a lender foreclose on their homes. Be honest with your lender and by working with them and examining the opportunities available as it is possible to get the financial help to stop foreclosure.
Saturday, July 21, 2007
The bank does this by filing a lawsuit in order to get a court order to foreclose. Once the court declares foreclosure on the property, they auction it off, with the highest bidder buying the property. There is a waiting period between the date of the lawsuit and the foreclosure sale, which is often between three and twelve months based on the foreclosure law in the destination. They publish a foreclosure ad according to foreclosure law at least thirty days before the auction, once a week for up to three weeks. Before they position the first ad, the homeowner must acquire a sheriffs notice of foreclosure sale. Immediately after the sale, the sheriff gives the title/deed to the new owner.
If you have fallen on hard times and missed some mortgage payments, there is still a possibility to save your home especially if you have not received a foreclosure notice yet. Return all phone calls and answer any letters regarding your home. Go in and talk to the lender or bank. Often they would much rather work with you instead of foreclosing on your house.
Bringing in an attorney familiar with foreclosure law is often a wise move as they can not only act as intermediary at this very stressful time and cover your rights but also work with you on saving your home from foreclosure.
You may be able to pay some of the missed payments and/or set up new monthly payments. At times, the bank will even allow you to refinance to reduce your monthly payments. As stated earlier, banks really do not want to foreclose on a home if they do not have to. Ask queries, seek help on foreclosure law and be aggressive about keeping your home.
Learn more about fundamental foreclosure law basics and other advice if you or someone you know is in a potential foreclosure situation.
Saturday, July 14, 2007
Are you or someone you know trying to stop foreclosure? If you own you property or properties and you're headed down the foreclosure route, you need to stop foreclosure on the property that you own before it becomes a real problem that could affect many other parts of your life. It's not uncommon for people in this situation to ask themselves what is happening, and why is it happening to me?. This is a natural reaction. Foreclosure generally tends to happen if you fall behind on your payments, your mortgage to the bank or payments to a lender that you have borrowed from.
Foreclosure Debt vs Credit Card Debt
This kind of debt is quite different to credit card debt or default on other personal loans. In the case of foreclosure, once you fall just one to two payments behind on your mortgage for instance, you rapidly begin to enter into foreclosure proceedings. You’ll still have some time before the organization you owe completely takes your home from you (if it goes that far); however, if you don’t stop foreclosure you will lose your home and damage your credit record.
What’s The Best Solution For Me?
If there’s a guaranteed way to stop foreclosure it’s to pay the amount you owe on your mortgage or other debt, e.g. tax lien. If for instance you’re behind on a couple of payments, it’ll take those two outstanding payments plus any applicable late fees and other charges to get you back to square one and stop foreclosure from happening on your home. While this may appear as common-sense, it’s often difficult for people behind on payments due to a lack of funds. The situation can be even worse when you have no way of getting extra money to pay down your own other debts.
What If I Approach The Bank?
You can certainly try, but you need to understand this hard truth.
The bank is really only interested in stopping foreclosure if you either pay off the entire debt that you owe (and this is the entire mortgage most of the time) or if you bring yourself up-to-date on your monthly payments.
What's My Worst Case Scenario?
If you’re unable to make your monthly payments, selling you home may be the only solution you have to stop foreclosure on your home. Do you have other assets that you might be able to sell to make payments on your mortgage? While you may not want to do this, it may be an option to consider.
A lot of banks and financial gurus warn against people in the situation where they want to stop foreclosure from borrowing money either from family and friends. Borrowing against credit cards to settle your debt if you want to stop foreclosure is also not advised because you may simply end up with even bigger financial problems.
If you simply don’t have the money required to pay off your debt, you’ll be wise to sell your home to someone that’s willing to buy it off you quickly. The benefit from this is that you’ll be able to save your credit and avoid legal proceedings against you.
If things do get to this stage, selling your home may understandably be quite a difficult decision – but something you might have to do. If there’s any way that you can get current on your mortgage, any way at all, it should become a priority so you keep your home and stop foreclosure. If you fail to take the necessary steps, the chances are that you won’t be able to stop foreclosure on your home.
Foreclosure is a terrifying thing and is hard to deal with. These tips and those you'll find in the Ultimate debt Guide will help you stop foreclosure on your home in the quickest and most efficient way. But you must take action -- No matter how small.
Tuesday, July 10, 2007
For individuals owning a home, they could be in a position of having the home foreclosed for lack of payment. If you have found yourself in a compromising position but desperately want to do what you can to save your home, the good news is that avoiding a foreclosure is possible if you know how.
A foreclosure means that the mortgage company or lending institution for your home can take it back to resell if you fall behind on payments. When this occurs, you have several options. First, you can go through a process to keep your home. Second, you can sell the home on your own and then pay off the loan plus any fees. Third, you can allow the home to go through foreclosure where they sell the home and you are responsible for any difference between the price the house sold for and the payoff balance.
If you fall behind on payments and begin to receive letters from your mortgage company, most importantly, NEVER ignore them. Instead, call the number provided on the letter and talk to a representative, explaining the reason why you fell behind. Just as with you, the mortgage company wants you to keep your home. After all, foreclosure is a hassle for them, expensive for them, and not something they want to do. Therefore, they will usually work closely with you to provide all possible options.
A Special Forbearance involves the mortgage company providing you with a temporary reduction or even a suspension of your monthly mortgage payments. If you have recently lost your job, had a reduction in income, or your living expenses have increased unrepentantly, this option may be ideal.
Another option is a Mortgage Modification. With this option, your mortgage is refinanced or the term of your loan extended. The way this program is designed, you have an opportunity to become caught up on payments. A Partial Claim is another possibility whereby your mortgage company would help you secure an interest free loan from HUD, which helps you bring your mortgage to a current payment status.
Remember, if you fall behind, rather than worry about foreclosure, talk to your mortgage company to see what programs you would qualify for so you can stay in your home. Never ignore the problem, because you likely have several viable options to fix your foreclosure problem.
Sunday, July 8, 2007
A growing number of homeowners behind on their mortgage and facing foreclosure are finding a way to sell despite the glut of Valley homes for sale.
They are turning to "short sales," which are similar to regular home sales except a deal is worked out in which the lender accepts what the house is appraised for or what it will currently sell for instead of what is owed on it.
So a homeowner would sell the house to a buyer willing to pay the current market value of the home, and the lender takes a loss on the rest.
Short sales are the latest trend for metro Phoenix's slowing real estate market, and housing advocates are advising struggling homeowners to contact their lender about a sale before falling into foreclosure.
As foreclosures rise, lenders are more motivated to do the sales because they at least get most of what they are owed.
Homeowners don't get any equity from the sale, but they also don't get a nasty foreclosure mark on their credit record. And although lenders lose out on money they're owed, a short sale lets them avoid a costly foreclosure on the home.
"Short sales are the buzz in the market now," said Tom Ruff of Information Market, a research data firm based in Glendale. "With foreclosures climbing and homes prices falling, short sales are bound to climb."
There is no way to track the exact number of short sales closing in the Valley because they show up on public records as a regular sale between a buyer and a seller. But real estate market watchers say they are seeing an uptick.
For the Valley's housing market, a short sale means one less foreclosure at a time when the number of people defaulting on their mortgages has tripled from a year ago.
It also is one fewer hit to Valley neighborhoods, where foreclosures are pulling down housing values.
Short sales lower an area's "comps," or comparable sales prices, too, but not as badly.
For some homeowners, they are the best option.
A brother and sister from California recently approached Phoenix real estate agent Brett Barry about their house here in the Valley. The pair paid $597,000 for the investment home in Tatum Ranch at the height of the housing market in 2005. Now, they can no longer afford to keep it. And with a record number of Valley homes for sale, their chances of selling the home for what they paid are slim.
"I ran the numbers, and the house won't sell for more than $495,000 now," said Barry, of Realty Executives. "They didn't put any money into it. They have an interest-only loan. They could only rent it for about $1,800 and month, but their payment is $3,500."
He told them they could do one of two things: Work out a short sale or call the lender and hand over their keys.
Lenders can benefitMost lenders prefer short sales because foreclosures cost them time and anywhere from $30,000 to $50,000 per house in legal, appraisal, marketing and servings fees. A short sale gets a home off their books and typically costs a lender less than a foreclosure.
At a recent foreclosure-prevention town hall meeting in Phoenix, the director of National Initiatives for mortgage giant Freddie Mac encouraged housing advocacy groups and lenders to steer people toward short sales if their only other option is foreclosure.
"We have an investment to protect as well as a moral responsibility to help people avoid foreclosure," Christina Diaz-Malones said.
A few years ago, most Valley homes to go to the foreclosure auction block enticed multiple bids from investors. But now, lenders are taking back 80 percent of the homes they are foreclosing on. Investors have stopped bidding on many houses because they can't make money on a resale.
To be eligible for a short sale, homeowners must prove they can't pay their mortgage because of some type of hardship such as a job loss, medical expenses, death of a spouse or, sometimes, too much debt.
But homeowners should be careful about confusing a short-sale plan with a foreclosure rescue scheme.
Once a homeowner misses a payment or two, a lender files a notice with the Maricopa County Recorder's Office to start foreclosing.
Many groups track those filings to try to buy foreclosure properties. But recently, some groups have begun preying on people about to lose their homes.
Many of the offers of help are thinly veiled schemes to get homeowners to sign over their house to groups that strip away any equity. Often, the homeowners then are required to pay rent until they can refinance and get their house back. But the rent is usually more than their old mortgage payment, and they wind up getting evicted.
Joann Hauger of Community Housing Resources of Arizona said groups that really want to help homeowners don't typically solicit them. More housing advocates such as Hauger are advising people to seek a short sale now instead of losing their home to foreclosure.
"Almost everyone we are seeing now for default counseling owe more than their house is worth," she said.
The hit homeowners take on their credit score is much less on a short sale than on a foreclosure.
A homeowner involved in a short sale will see an 80- to 100-point drop on his or her credit score. A foreclosure is a 250- to 280-point hit, said Randy Kutz of Phoenix Heritage Real Estate Group, HomeSmart. About 70 percent of his business now is short sales.
"Banks don't advertise they are open to short sales, but banks don't want to take the homes back," he said.
People who are able to do short sales will have a tax hit.
The difference between what a homeowner owes and what the bank gets for the house is typically treated as income for the seller. That's taxable income for the homeowner that will show up on a 1099 form from the lender.
The lower sales price from a short sale won't please too many of the homeowner's neighbors. It will show up like any sale and often will be a considered a comp for the area that other buyers and sellers use as a benchmark for home prices.
But housing market watchers say a lower comp or short sale is much better for a neighborhood than a home repossessed by the bank at a foreclosure auction.
"Foreclosed homes can quickly turn into empty eyesores with green pools, yards full of weeds and debris when lenders take them over," Barry said. "A short sale means a new owner for the home and one less foreclosure black mark for the neighborhood."
Free Foreclosure Workshop
Tuesday, July 3, 2007
Its important for securing your financial future - if there is no debt elimination, then there is no capital to build upon. With debts mounting, one can't save or invest for the future. Therefore when you really require money for the future, there is none for you. Money depreciates in value as inflation continues to rise. Therefore the same amount of money will not buy the same amount of goods and services in the future.
Securing the future of the children - if you have family obligations, whether they are children or your parents, you would want to give them a secure future. This means paying for your children's education, medical bills etc. In these situations, you would want fastest progress. After there is elimination of debt you can secure a future for your loved ones. Having a good credit rating - if there is no debt elimination, then you will have an adverse credit rating. This means that it will become difficult for you to apply for more loans and debts.
Banks and other lenders will be wary of lending to you. Even if the lenders give you loans, there will be a high collateral value or high interest rates. Thus you will be stuck in a debt trap. Where you will be borrowing just to repay the old debt. This is known as a debt trap, therefore its very essential that debt is eliminated, thus debt elimination gives you leeway to plan for your future. Debt elimination should be done continuously and with a conscious effort. Therefore don't take small debts as they add up to big debts. Try to make expenditures out of the available cash in hand, this means that you are not living on credit. Thus one should strive for debt elimination at the earliest.