Avoid Foreclosure Archives Page 2 Of 2 – Refinance – Mortgage Refinancing Rates And Information

Avoid Foreclosure: 7 steps to save your home.

August 8th, 2009 No comments

Foreclosure, bankruptcy, unemployment are problems that seem so large as to become apparently insurmountable for many of its victims. That of course is one of the worst aspects of these crisis, they take away hope and energy out of people leaving them as shells of the people they used to be.

The situation is difficult and there are no easy fixes no matter what sleazy debt relief companies tell you however there are steps you can take to improve your situations. These steps are not magical and they will not guarantee your financial safety, they should however be part of your plan to avoid foreclosure or bankruptcy when in financially dire straits.

Step 1. Talk to your lender.
Lenders need to hear from their borrowers to have a clear understanding of their position. Imagine if you lent some money to two friends. One of them explains he has lost his job and cannot pay you as fast as he had hoped but presents to you a revised schedule with smaller but regular payments. The other friend has also lost his job but decides to ignore you and will not even explain his situation to you. Who would you be more inclined to give a break or treat kindly? Yep, banks feel the same way.

Step 2. Contact approved housing counselors.
There are plenty of debt relief companies willing to take your money to “help” you refinance or modify your mortgage. Some of them can help others are frauds. It pays to contact legitimate counselors throught the Department of Housing and Urban Development to make sure you are dealt with fairly. These counselors can help you for free and offer unbiased advice.

Step 3. Don’t pay for services you haven’t received and always sign a contract.It is against the law for debt relief companies to receive payment before they sign a contract explaining the services they will provide and before they actually carry out those services. Don’t be duped by companies that promise to reduce your loan and ask for payment before they do the work.

Step 4. Do not transfer your home to a debt relief company or “rescuer”.
A popular scam the Treasury and HUD departments are warning against is being carried out by fraudulent debt relief companies. They will tell you, you need to transfer ownership of your property to someone with a better credit rating so he can refinance your home and you can later on repay it. Obviously this is a scam to steal your home and rape it of any equity it might still have.

Step 5. Only pay your mortgage payments to your lender. Some scam consultants offer to take over the details of paying your mortgage as part of their debt settlement services. There have been many reports of debt relief companies pocketing the payments without making payments.

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Avoid Foreclosure By Calling Your Bank Early Says HOPE

August 1st, 2009 No comments

Mortgage modifications are the only hope for millions of Americans that cannot continue paying their monthly payments. One of the typical reactions when people are behind in their payments and cannot see a way out is to simply ignore the bank or mortgage lender. This is a terrible idea that only makes things worse.

HOPE NOW the government run free mortgage counseling program explains the reasons why you must contact your mortgage provider as soon as possible in a new Video narrated by Queen Latifah. The video explains the consequences of not contacting your bank when you are behind in your payments or fear you will be in the near future.
The video illustrates this point through various real life cases of people that initially were reticent to calling their bank but were able to face their fears and solve the situation.
Another issue that the video deals with is that many banks are completely overwhelmed with the volume of borrowers that are calling to ask for loan modifications. Hope provides a way out by advising borrowers to head to theHUD.gov website to find advice and help when lenders cannot (or will not) reply to their calls.

This video deals with two serious issues that are causing many to lose their homes unnecessarily:

1) Borrowers not contacting their banks and finding a negotiated solution to the debt and

2) The apparent inability of banks and lenders to deal with the great number of borrowers in need of help.

Borrowers don’t contact their banks for various reasons. As illustrated in the new HOPE NOW video many borrowers don’t contact their bank about their late payments because they don’t have a good payback plan to present to their lender and feel embarrassed to contact them. Other’s have little understanding of the options at their disposal and simply ignore the efforts of the bank to contact them. Still others are not even sure who their lender is or how to contact them. The video illustrated how to find out by checking one of the mortgages payment slips which carries the lender’s name and telephone on the back.

The speed at which banks are dealing with customers loan modifications has caused many to feel that banks are not committed to providing loan modifications and are dragging their feet going through the motions. Although loan modifications can in many cases be beneficial to both the bank and the borrower, allowing the homeowner to keep his home while the bank can make more money on the same loan, in some cases they are not cost efficient for lenders that would do better foreclosing the loan.

The government has recently committed extra funds to incentivize banks into accelerate their mortgage modification programs in order to help the millions of Americans that risk foreclosure on their mortgages this year.

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Debt Relief, How To Get The Counsel You Need

July 30th, 2009 No comments

Debt is a terrible thing to undergo, especially when you don’t know how to get debt relief. Although it is a popular word nowadays due to huge effort various governments are putting forward to buy save millions of families from losing their homes or declaring bankruptcy, finding accurate and unbiased advice is no easy task. If you are reading this page it is probably because you want help and effective tips on how to reduce your debt or at the very least manage it so that it is more affordable on a month to month basis.

If you read this article and many more on this site you WILL find help and great ideas to improve your financial situation. However you don’t want to stop here, our advice or that of any other site you are going to find online is not personalized to your unique situation.

By reading this site you will understand the principles behind debt relief an how to reduce your interest rate, monthly payments or even your principal debt but you will need to take a step further to put this advice into practice. If you don’t you will be like a doctor who smokes, a highly trained in the miracle of the human body with a thorough understanding of what harms and heals that disregards that hard earned knowledge completely due to his own weakness or laziness.

Remember ignorance is not bliss, many people find themselves in terrible financial situations they can avoid because of it, but knowledge is worth nothing if you don’t use it. So how can you find the counsel you need:

Speak to a local government helpline or visit their website. They do exist and they can be extremely helpful for people that are honestly struggling to make ends meet. In the United States you can contact the HUD.gov government website that will help you with all kind of advice on how to avoid a foreclosure, qualify for government aid and other useful programs.

If you are in need of aid you can only blame yourself if you don’t make at least the effort to ask for help from those whose job it is to offer it.

Speak to your bank. This might surprise you but talking to your bank or lender might actually get great results when managing your debt. Banks will depending on your circumstances be happy to lower your monthly payments in exchange of either a larger loan, higher interests, a modification fee or a combination of all three. However for banks to be interested in “helping” you like this you must be a specific sort of “borrower” and of course that is the kind of borrower you want to make sure you portray yourself as. Banks will only have an incentive to provide monthly payment reductions to borrowers who really can’t pay their mortgages or debts at the current monthly installment but will be able to do so if it is lowered.

However banks will not try to help borrowers that can pay their home mortgage payments if they really struggle, use up their savings or change their lifestyle in order to do so. Banks don’t care how much you struggle as long as you can pay, somehow. Secondly, banks will generally not even try to help people that have no chance of paying their debt no matter how much it is reduced. It is actually better for the bank to immediately foreclose the debt without wasting time and resources.

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What Is A Foreclosure?

July 27th, 2009 No comments

Sometimes the things that scare us the most are the subjects we know less about, death, darkness, losing someone we love and foreclosure are just a few examples. There is a reason we know little about the things we fear, not knowing is often worse; we always imagine things are worse than they really are. Learning about our fears and finding ways to deal with them is the best policy. This article will aim to shed some light on the issue of foreclosures and what they really are, that way we will hopefully fear them less and learn how to avoid them.

Foreclosure is a legal term to describe the termination of a mortgage or loan. Foreclosure occurs when the mortgagee (the lender) gets a court order that terminates the mortgage and allows the mortgagee or lender to redeem the mortgage’s security, nearly always the home itself. This occurs when the borrower fails to pay the mortgage principal and interest payments; the lender has then the right to force the borrower to either pay the payments he is behind in plus costs or sell the house or some other asset to meet his responsibility of paying the mortgage. When the borrower sells the property and uses the proceeding to pay the lender it is said that he has foreclosed the mortgage.

This rather dry definition we worked through provides some interesting points.

1) A foreclosure is a legal process that must be approved by the courts of equity. 2) Losing the house is not the only way to deal with the situation. The government is trying its best to avoid foreclosures and is willing to help most people that are willing to work hard to find a way around a foreclosure through loan modification and other types of financial aid. Do your homework and make it your job to jump through the necessary hoops to save our home.

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Avoid Foreclosure, There Is Always HOPE

July 27th, 2009 No comments

There are few things scarier than losing your home and seeing your family on the street. Unfortunately many Americans and people worldwide are facing this problem due to the worldwide crisis. As we know most governments are doing their best to protect poor families that are at risk of losing their home because they are unable to meet the mortgage payments. One of the measures the American government has provided is the HOPE program. This program began under the Bush administration and the current administration has just expanded the availability and extent of the mortgage protection program for families.
Sadly many families don’t understand or know about the program and how they can benefit, if you fit this profile what can you do make the most of the helping hand the government is trying to provide. Information is as usual the most powerful weapon whether you are trying to fight a war or pay your home loan. If you are having trouble paying your mortgage and need aid to avoid foreclosure you need to get working on solving your situation.
1) Find out what your situation is exactly. This means working out how in debt you are, what your interest rate on each loan is, what your prepayment penalty is on your current mortgage and compare it with your current income. You would do well to get all the paperwork you are going to need together. Contact your mortgage provider and ask for an up-to-date review of your mortgage and the details of the contract.

2) Once you know how bad things are you can start making productive steps towards solving the situation. For instance you should get a feel for the value of your home and compare the current value with the outstanding principal on your mortgage. Once you have this information you should contact your lender. You should contact your lender before you are behind in your payments; this will show you are acting in good faith and want to solve the situation. Lenders can often provide breaks and good re-financing deals to customers that make the “right” decision. If your lender will not work with you, you might need to look to other lenders before your credit rating starts to suffer.

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Avoid Foreclosure With A Personalized Home Loan Modification

July 16th, 2009 No comments

Avoid Foreclosure With A Personalized Home Loan Modification

Foreclosure has turned from being a four letter word so taboo it was barely mentioned to a common feature of life we have nearly got used to. Can we avoid foreclosure? Or is the common household doomed to foreclose and buy again depending on the economic climate?
Well although economic pressures can sometimes cause irreversible damage to a family’s income and resources making foreclosure the only way out this does not have to be the general rule. There are steps we can make at every stage of economic hardship to try to avoid the “f word”.

The first fact that we must understand is that nobody likes a foreclosure, banks don’t like them, the government hates them and you and I certainly don’t want anything to do with it. All this begs the question; if everyone hates a foreclosure why have them? The same question could be applied to wars, famine, violence and the answer may be similar. Often one or more of the parties involved simply don’t have the will to continue working towards a positive outcome.

Well, enough generalities and poetic comparisons what can a real family or individual do to avoid foreclosure.

Step 1. Don’t buy a house outside of your means. Obviously if you already own the house this advice comes a little late but for any new home buyers it is great advice to not be swallowed up by the temptation of paying more than you can afford for a house. A good rule of thumb is to not pay more than 30% of your income on your home. This gives you a little bit of a safety net if things go bad and the opportunity of saving a portion of your income for a rainy day.

Step 2. Control spending. Be ruthless. If income and expenditure are not tallying take control of your budget and keep to it.

Step 3. Talk to your bank as soon as possible. Banks hate foreclosures because they more often than not lose money and it is not what they prefer to be doing. They are not estate agents they are banks that want to be making money by lending and investing not sweating the details with a bad house sale. If you approach them before your credit is in the dirt and you provide them with a plan they will try and work with you.
Options open to your bank you might apply for are payment holidays for a determined amount of time if you have evidence that your income situation will change in the future, or a full on loan modification. Remember these modification actually make more money for your bank. What do you think they will prefer, foreclosure or a making more money on your mortgage?

Loan modifications come in a large variety of colors and shades. You can modify your loan to last longer which will make your monthly payments lower. Imagine you owe your bank $1,000 and you need to pay it in three months, $333 and you can’t afford it, so you ask the bank if you can pay the same amount in ten months making it a much more affordable monthly payment of $100. The only glitch with this option is that you end up paying more interest. Another option is to change your mortgage provider to one that is willing to charge you a lower interest. This is a great option that is often combined with a larger mortgage (not a good idea in most cases) and a lengthening of the loan’s tenure (also expensive in interest), the only problem is that changing mortgage providers or even just changing interest rates if your bank is willing to renegotiate terms is often a lengthy process.
The thing to remember is that there are options, the ones we have discussed are just a sample. Talk to your bank or even with a financial adviser and study what options you have, just don’t give up.

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