For foreclosure help, please visit: http://www.rhrrescue.com/
I want to share three true stories of real people who are facing foreclosure. They are all within the same block in a nice suburban neighborhood of Chicagoland. These people represent Middle America today.
Real People, Real Problems
1. A single mother of two who packed up her entire 3-bedroom home within a week and moved in with friends. When asked why she didn’t fight the foreclosure, she cried saying that she had no idea that she had any options. She was intimidated when she got a letter from her lender asking her to leave the premises, panicked and did as she was told. Six months later, her house had a ‘For Sale’ sign on its lawn – it was repaired, painted and now sits pretty waiting for new owners, until then, a light stays on all night for security.
2. Her neighbors face a more common scenario we hear about — they received a letter from their lender stating that they could apply for a loan modification and could start paying lower monthly installments immediately. After the lender lost paperwork, asked them to resend the same forms several times and their countless conversations with customer support only to get a different story each time, they received a foreclosure notice a few months later stating that they defaulted on their loan payment and need to leave the premises. They were advised to hire a lawyer who in-turn advised them to stay in their home until the issue was resolved. So now, they wait.
3. Another neighbor who lives in Florida rented out their investment home. When they got a foreclosure notice from the bank, they just dropped the property like a hot potato. Their tenants were asked to leave and now a year later, the property is empty, unkempt, and looks abandoned.
What could have helped them keep their homes? In brief, they needed to:
- Get informed and take action! There ARE many options to help people avoid foreclosure.
- Contact their lenders to look at options to avoid foreclosure.
- If the lender was uncooperative, they could have approached a HUD approved housing counselor.
- Spoken to an industry expert – for example, Ryan Hill Realty offers free advice to people facing foreclosure.
Get Free Assistance!
Help is FREE! Please note that there are foreclosure rescue scams out there – when you seek help, go to the correct sources. You don’t need to pay for advice or help.
Here is a very informative web page to help you make the right choice: http://www.makinghomeaffordable.gov/learn-more/Pages/beware.aspx or call 888-995-HOPE.
In August 2010, the State Foreclosure Prevention Working Group presented a Memorandum on Loan Modification Performance stating:
“More than six out of ten (62.5%) seriously delinquent borrowers were not involved in any form of loss mitigation efforts. The biggest failure of foreclosure prevention efforts continues to be the inability to engage homeowners in meaningful loss mitigation efforts in the first instance. Beyond the usual factors driving borrower non-response, some reasons for the low involvement of struggling homeowners include mixed messages communicated to struggling homeowners regarding foreclosure and loss mitigation opportunities, a lack of transparency in loss mitigation options and process, inconsistent and confusing information provided to homeowners during the process, poor customer service delivery, and long delays in the modification process.”
Have You Done Your Research?
I was recently in California where I attended two Default Servicing conferences. Laurie Maggiano, Director of Policy at the U.S. Treasury Department and Rick Sharga, Executive Vice President at Carrington Mortgage Services spoke about the current market and various government and bank programs to assist borrowers in avoiding foreclosure. Some of the key points were:
A majority of these programs are administered through HUD (U.S. Department of Housing and Urban Development) and the Department of Treasury.
- Since Home Affordable Modification Program (HAMP) was established in 2009, the organization has provided modifications to 1 million borrowers who have received an average of $535 a month in payment reduction.
- Private Sector Lenders have created their own HAMP-like modification, providing 3 million loan modifications to date. 60% of the borrowers who received a loan modification received a reduced payment by 20%, and the re-default rate has dropped by 25%.
- The Private Sector has developed national servicing standards (HAMP protocol), (ie. Wells Fargo, Bank of America, Chase, credit unions, etc.). This empowers and encourages homeowners to make effort to talk with their lender as soon as possible to discuss options. The mandate will prevent a foreclosure if the borrower is working with lender.
This is due to a) Part of Obama Bill of Rights (just released), AG settlement and Regulatory National Servicing guidelines.
- HUD and NeighborWorks are reaching out through a Public Service Campaign offering to inform borrowers of the options available to them. Explore and engage to empower yourself.
- The Home Affordable Foreclosure Alternatives (HAFA) Short Sale Program has gone through changes that include, a) Complete elimination of owner/occupied regulations, b) Have no occupancy requirements, and c) If tenants have to move as a result of HAFA transactions – the tenant is eligible for $3,000 relocation incentives (this is also applicable to owner/occupied) – but not for investors who don’t live in the home.
NEW OFFERING AVAILABLE FROM JUNE 1, 2012 – HAMP II (TIER II) – Loan Modifications
- Has broader income range than HAMP I for loan modifications
- Making modifications available to “non-owner/occupied” borrowers (Investors)
- For investment properties that are rented full time (non Fannie or Freddie)
- Or investment properties that are vacant but “intended” to rent full time, will be eligible
- Not for 2nd homes or vacation (part time) rentals
Borrowers can apply to HAMP now and begin the process, but if they don’t qualify for HAMP, then they can be considered for HAMP Tier II
Borrowers who act early have the biggest chance of modifications.
- Many lenders, such as Bank of America and Chase, have Homeownership Centers throughout the country to provide face-to-face assistance for borrowers. Contact your servicer.
- There are programs to help the Military
- These programs are supported by Fannie, Freddie and HUD
I feel it’s important to mention the following information just in case you miss it on the HUD.gov website. I encourage you to visit the site and thoroughly look through all the content applicable to you case.
When A Lender Doesn’t Cooperate:
Homeowners facing foreclosure can speak directly to their lenders.
If lenders don’t cooperate, homeowners have the following options, depending on the type of loan:
For an FHA-insured loan
Your lender has to follow FHA servicing guidelines and regulations for FHA-insured loans. If your lender is not cooperative, contact FHA’s National Servicing Center toll free at (877) 622-8525,or via email. Whether by phone or email, be prepared to provide the full name(s) of all persons listed on the mortgage loan and the full address of the property including city, state and zip. We may be able to help you more quickly if you can also provide your 13-digit FHA case number from the loan settlement statement.
For conventional loans
If you have a conventional loan, first talk to a HUD-approved housing counselor at (800) 569-4287. They may be able to help you with your lender. You can also contact HOPE NOW or call the Homeowners Hope Hotline at (888) 995-HOPE to ask for assistance in working with your lender.
(Source: HUD.gov – Avoiding Foreclosure – Working With Lenders)
Are you still unsure of your options?
Contact me, Teresa Ryan on 630-253-7660 at Ryan Hill Realty for FREE information on how to save yourself from foreclosure.