Faced With Foreclosure ? Important Steps to Take

Foreclosure Help if You are Unemployed

2011-11-11T00:37:00.000-08:00

What happens if you have recently lost your job and are unemployed ? If you are struggling to make your mortgage payments, or cannot make them at all, you may be able to apply for the Home Affordable Unemployment Program, known as HAUP, or simply UP.

HAUP is a government program designed to help you with your payments while you are actively seeking employment. You may be able to have your mortgage payments reduced in amount, or even postponed for a period of at least 3 months.

In order to apply for this program you must meet the Eligibility and Qualification Guidelines:

* You must be unemployed on the date you apply for HAUP.

* Only homes from 1 to 4 units qualify.

* You must occupy your home as your primary residence.

* Your existing mortgage payments are delinquent, or are likely to become delinquent.

* You must apply for the program before you are 3 months delinquent on your payments.

* Your mortgage must not be previously HAMP modified. ( Home Affordable Modification Program )

* You should be collecting or be eligible to collect unemployment benefits.

If you qualify for the HAUP program and your mortgage payments are reduced, they will not be more than 31 % of your gross monthly income, including unemployment benefits.

If you would like more information about the HAUP Program, call a HUD Approved Housing Counselor at: (888) 995-4673.

There is no cost to you for this service.

Are You Faced With a Foreclosure? Important Steps to Take to Save Your Home.

2011-08-10T03:27:00.000-07:00

Don't Let the Bank Take Your Home ! Being faced with a foreclosure can be an extremely stressful and emotionally draining experience - to say the least...so if you find yourself in this situation, here are some steps for you to take to help save your home:

Step 1. Talk to Your Lender Immediately - Gather all of your Mortgage Documents and go through them. Write down your lender's phone number and your mortgage loan number. Take these and your coupon book or loan statement with you to the phone - it's important to have your loan number ready when you call...

Step 2. Ask for Your Lender's Loss Mitigation Department - After you are connected to Loss Mitigation, explain your financial situation and tell your lender why you are unable to make the monthly payment on your home.Most lenders are agreeable and want to work with you if you call promptly and explain to them what happened. For example: You may qualify for a "hardship" if you lost your job, are going through a divorce, have high medical bills, or have had a death in the family. Make sure you write down the person's name that you talked with, along with the date and time, for future reference.

Step 3. Inquire About a Loan Forbearance - Some lenders will consider this option, which means that you agree to pay part of the back payments you owe now, and the remaining balance is to be paid within a time period of the lenders choice, usually around six months. After this time period, you would again resume making your monthly mortgage payments. This option is used to buy yourself some time, so that hopefully you can get your financial situation straightened out.

Step 4. Ask About a Loan Modification - If a loan forbearance isn't an option, a loan modification might be a possibility. This means that your lender would be willing to change the terms of your mortgage permanently - such as your interest rate or monthly payment allowing you to be able to make payments that you can afford. The lender can even write off some of your balance in certain situations. This option is usually used with the "hardship" situation mentioned in Step 2.

Step 5. Consider a Loan Reinstatement - If it is possible for you to make up all of the back house payments you owe, including the mortgage company's fees, your loan can be reinstated and you continue to make your monthly mortgage payments. You may have to borrow money to do this, which would add another payment each month. If your financial situation is extremely strained already, this might not be an option.

Step 6. Ask About the FHA Secured Loan - If you had an Adjustable Rate Mortgage and you are in foreclosure because the loan amount adjusted so high that you can't afford to make your loan payments, consider the FHA Secured Loan. If you were current on your payments before the loan adjusted, you may qualify. You must have 3 percent equity in your home, or 3 percent in cash. You must also income qualify and the home will be appraised for value. Some lenders may forgive part of the loan to get the LTV (loan-to-value) needed if you meet the other qualifications that they require.

A Good Foreclosure Option - HUD Approved Housing Counselors

2010-01-24T00:30:00.000-08:00

HUD Housing Counselors offer assistance and advice on several different aspects of real estate housing, such as buying a home, renting a home or apartment, reverse mortgages, assisting the homeless, eviction notices, default notices, and helping homeowners avoid foreclosure.

Talking with a HUD approved housing counselor is a good option to take if you are facing a foreclosure, or are in pre-foreclosure. Losing your home to foreclosure can be emotionally devastating and some homeowners are reluctant to call their lender and admit that they cannot handle their financial situation any longer, which is the worst mistake a homeowner facing a foreclosure can make.

Some homeowners who have received default notices and are in foreclosure say that they either don't have the time to call their lender and try to work out all of the details of getting their mortgage back on track, or they don't want to do this without some kind of help.

In these types of foreclosure situations a HUD approved housing counselor can assist you.

The Department of Housing and Urban Development which is also known as HUD, offers a housing counselor service that can can present and suggest options to help you with your particular situation either free or at very little cost.

Housing counselors are experienced with the options lenders can take with homeowners who are in foreclosure, and will most likely know which course of action would be best for you before your lender is contacted.

A HUD housing counselor can help you understand the details and steps of foreclosure, and can act as a representative for you when meeting and discussing your situation with your lender if you require it. A housing counselor can also assist you with your finances by providing you with a personalized budget plan designed with your financial obligations and mortgage payment in mind. This will help you and your lender decide which is the right option for you to take regarding your mortgage.

If you are facing a foreclosure now, or you have lost your job or have a hardship situation in your family and know that you will not be able to pay your mortgage in the near future, the best thing to do is to call a HUD approved counseling agency as soon as possible and make arrangements to meet with a housing counselor.

To find a HUD approved housing counselor near you, call: 1- 800 - 569 - 4287.

or You can visit their website at: http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm

Foreclosure - Update For Hope For Homeowners (H4H) Mortgage Assistance

2008-12-08T20:03:00.000-08:00

=> Update: As of November 19, 2008, the Hope For Homeowners (H4H) Program has changed, and now provides even more assistance for homeowners in foreclosure...

These Changes Include:

* More Flexibility - For some H4H qualifying homeowners, the LTV(or Loan To Value) will be increased to 96.5 percent, instead of the original 90 percent LTV, helping a larger number of homeowners who are facing foreclosure to qualify for the program.

* Lenders will now be allowed to extend terms on 30 year mortgages to 40 years, lowering amortized payments, and increasing qualification ratios.

* Subordinate lenders, or lien holders will be offered an immediate payment by H4H to release their liens, allowing more homeowners in foreclosure to take advantage of this program.

* These recent changes are allowing more homeowners who are facing foreclosure to be able to save their homes... the changes will hopefully be appealing to more lenders who hold the existing mortgages on these homes, encouraging them to hold off on foreclosures, and to refinance the loans through the H4H program.

* Homeowners interested in this program will still have to adhere to the guidelines for qualification, as stated on my previous post: "Foreclosure Help - New FHA Hope for
Homeowners (H4H) Program."

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Foreclosure Help - New FHA Hope For Homeowners H4H Loan Program

2008-10-16T02:25:00.000-07:00

Here is another new FHA insured loan program especially for homeowners who are at risk of foreclosure because their mortgage payment is too high compared to their gross monthly income received.

For Example: Your mortgage payment amount, as of March 1, 2008, would have to be over 31% of your gross income each month.

Let's say that you have a mortgage payment of $ 1,500 - and your gross income is $ 4,000- . Take your payment of $ 1,500- and divide it by your gross income of $ 4,000- and you get 37.5 %. That's over 31% of your income - you could qualify for this new program...

The new H4H loan program would allow you refinance your loan and get a fixed rate 30 year mortgage that cannot be over 90% of your home's new appraised value, which of course means there will be an appraiser sent out to value your home in today's market.

NOTE: The H4H loan program is called a " voluntary " program - this means that both you and the lender must be willing to participate. Since the new mortgage cannot be over 90% of your home's new appraised value ( as stated above ) the lender will have to accept that new loan amount by "writing down " any excess. In other words, the lender has to agree to take a loss on the loan.

Some lenders may not want to participate in the program, and take the loss, but many lenders are participating - Why? Because lenders do not want more foreclosures on their "books" - lenders don't want to be responsible for foreclosures - this costs them money.

Lenders who participate in H4H and agree to take a loss on the loan -to- present value, now have a homeowner who can afford the monthly payment and can stay in the home - no foreclosure worries...

Here is a Very Basic Guideline for Qualification:

** Your home is your primary residence -meaning that you live there and occupy the property. You cannot own investment homes to qualify.

** As stated above, your mortgage payment must be over 31% of your gross income each month.

** You cannot make your monthly mortgage payment now or will not be able to...

** You have not defaulted on any loan, including your mortgage loan, intentionally.

** You did not give false information to your lender to obtain your mortgage loan (called "liar loans")

** You must be able to provide verification of your income over the last 2 years - including tax returns.

As with any loan, eligibility is not guaranteed, but if your financial situation is such that you cannot make your mortgage payment or know that you won't be able to in the near future, it would be a good idea to call your lender and ask about this program.

In Foreclosure Because of an ARM Loan? Try the FHA Secure Loan

2008-09-30T01:25:00.000-07:00

If you are in foreclosure or pre-foreclosure because your Adjustable Rate Mortgage (ARM) loan interest rate has adjusted and you can no longer afford the monthly mortgage payment, the FHA Secure Loan may be the way you can save your home...

The FHA Secure Loan Program is a mortgage refinance option designed to help the many homeowners who have defaulted on their mortgage payments because of an ARM interest rate adjustment. You don't have to have an FHA adjustable loan to qualify - this program also helps homeowners with other types of adjustable loans.

If you have tried to refinance your ARM loan, and have been turned down by the lender, you may still qualify for the FHA Secure loan even if you are short on equity or your home is now worth less than the amount of your mortgage loan.

Qualification Guidelines For The FHA Secure Program:

* You must have an owner - occupied property - which means that you live in the home as your primary residence. Investment homes do not qualify for this loan.

* You must have an adjustable rate mortgage interest rate that has adjusted or re-set, or is going to re-set by December 2009.

* You must have either 3% equity in your home, or you must have 3% in cash.

* You must have an employment history for the last 2 years in the same line of work. If you had a job change within the last 2 years, and you are not in the same line of work, depending on the circumstances, FHA may still consider you application.

* You must have sufficient income to qualify for the FHA fixed rate payment, which includes property taxes, and property insurance. (Called a PITI payment)

* You must have a proven credit history of your mortgage payments being made on time before your initial adjustable interest rate re-set.

If you meet these guidelines, the next step is to find a lender that offers the FHA Secure Loan and apply, as this loan may be able to help you out of a foreclosure situation...

TIPS ON BUYING A FORECLOSURE

2008-09-23T21:33:00.000-07:00

Buying a foreclosed property can have its benefits, but there can also be risks involved. If you are a first-time buyer this may be the opportunity you have been waiting for, as foreclosed homes generally are listed at a lower price than other listed properties.

First of all, an REO is a "Real Estate Owned" or bank owned property, meaning the previous owners could not make their loan payments, so the lender or bank repossessed the property and now has it listed (usually with a real estate broker) as a foreclosure...

Tip # 1 - Find a Realtor who knows the foreclosure process and has experience with foreclosure transactions. This is extremely important - especially if you know little or nothing about the process. A good Realtor knows how to negotiate with banks and lenders. Some lenders are very cooperative, and some are almost impossible to deal with, so interview a few Realtors and ask them about their foreclosure knowledge.

Tip # 2 - Get Pre-Approved with a lender and find out how much home you can afford. Your Realtor can help you with this if you don't already have a lender. Not all REO properties are financed by the bank or lender that has taken the property back, although I'm finding more and more banks that are willing to offer financing to the new buyer. Be sure to get a copy of your Pre-Approval Letter, as banks offering financing on REOs almost always ask for the letter, and will want you to Pre-Approve with them to get their financing.

Tip # 3 - Tell Your Realtor about the type of home, the area desired, and amenities that you are looking for: Do you want a 2, 3, or 4 bedroom home? Pool or no pool? What about square footage? Low Maintenance Yards - or not? ( Tip # 3a: Write all of this down before you see your Realtor, and remember: what you are looking for depends on the sales price that you qualified for with your lender...). Ask your Realtor to pull up listings of foreclosures that fit your price, area, and as many amenities as possible.

Tip # 4 - Start Looking For Homes and remember: the former owners may have been very frustrated and upset about losing the home and may have damaged it before they left. The condition of these homes can be anywhere from good to completely trashed... holes in the walls, tiles missing, burns on the carpeting, appliances pulled out of the walls, etc..So if you are a first time buyer - don't be surprised at this.

Tip # 5 - Keep Looking Until You Find It - By this time you know what you want in a home, so do not compromise unless you absolutely have to. Don't settle for a smaller home with one less bedroom or bathroom, or buy in an area you don't want to live in - just because the price is lower than what you can afford...Don't rush the process - look at what's out there, and choose the home that most fits your criteria.

Tip # 6 - Make an Offer on the right home for you. Discuss with your Realtor how much you would like to offer on the home, but don't "low-ball" it. Remember: if the offer is too low, the bank or lender may just flat-out refuse, knowing that they will get another offer that's higher. Some sought-after foreclosures have multiple offers presented to the bank all at once - meaning that the bank priced that home below the foreclosure market, and other buyers are making offers too. So keep it reasonable - you don't want to lose the right home and be back to square one... Your Realtor will know if the home has multiple offers - if it does, offer a little MORE than the asking price if you really want it.

Tip # 7 - Include Repairs in Your Budget - Foreclosure homes are usually listed with the phrase " as-is sale, no warranties expressed or implied" or something to that effect. This means that the bank will not make the repairs and the home is purchased "AS-IS". So, remember to take the cost of the repairs into consideration when making an offer. Now, in a few cases the lender may make some of the repairs - this is where your experienced Realtor comes in. If the home has been listed for a long period of time - a year or longer, and your offer is all the bank has for now, your Realtor (expert negotiator) can get on the phone and ask for some things to be repaired. It's not guaranteed they will comply, but I have had a lot of success in this area...

Tip # 8 - If Your Offer is Accepted by the bank, the home will go through escrow. You will be asked to sign escrow documents, and stacks of paperwork.( Be Sure You Bring Your ID With You). How long will escrow take? It depends on various factors: the time it takes for the bank or lender to respond to your escrow officer, your own lender if you have your own financing, liens on the property, etc.. I have seen escrow take between 14 days and a few months on these homes.

Tip # 9 - When Escrow Closes and Records - Congratulations !!! You now own your own home and look at how much money you saved on the price compared to a few years ago...

Tip # 10 - Special Tip - Unless you have experience buying foreclosed properties - Do NOT try to buy a foreclosure at an Auction !!! These homes are bought "sight-unseen" - you have not seen the property in most cases, and you have no clue about the condition, repairs, whether or not the home is completely trashed, back taxes, liens, etc.. Also, in almost all cases these are cash bids and these homes sell for all cash offers.

* * * * If You Are a First Time Buyer and Would Like More Information About the Home Buying Process, Please Visit This Page : http://first-timebuyertips.blogspot.com/

Stef

FORECLOSURE - BE WARY OF CERTAIN INVESTORS...

2008-09-23T00:08:00.000-07:00

If your home is in foreclosure, you are probably exploring your options, or are wondering what to do next. You may be swamped by letters and phone calls from many interested investors wanting to make a possible offer on your home. Many of these investors are ethical people who really can give you an option by offering you a "quick close" - but many investors are not honest or ethical at all.

Some of these "investors" just want your home for the absolute lowest price they can get - others are "scammers" who use a variety of ingenious plans to force you to unknowingly lose your home. Some of the more aggressive investors will even come to your home and knock on the door until you answer it - some will follow you like an investigator until they just "happen to run in to you" and offer up their plan to save your home... Watch Out For These People !!!

I've heard of threats made to homeowners in foreclosure by investors who tell them that their home is set to sell on the auction block within a short time, and that everything (including the owner) will be thrown out into the street - leaving the owner homeless. Then of course, the investor makes a "low-ball" offer to purchase the home.

I have also heard of "secretive" investors who tell the owner not to call an attorney, their lender, or anyone else, and then have the owner sign their contracts assuring them that their foreclosure and loan will be taken care of. In actuality, the owner has signed a quit-claim deed - giving the home away to the investor !!!

There are good, ethical investors out there who will agree to buy your home for a fair price when homes just aren't selling in this market, giving you a way out, if it comes to that, but on the other hand you have to know who you're dealing with...

A Good Rule to Follow is: have your attorney look at all contracts before you approve anything...

Hope this helps someone...

Stef