What Do I Do Now?

My home is not worth what it used to be, and my interest rate is supposed to go up soon. The media is saying that nobody can get any financing. My neighbor lost their home, are we in jeopardy of losing our home?

This question sure comes up a lot recently, with all of the foreclosures dominating the news, media and our home towns. So what are you to do? The first thing you should do is find out what your home is actually worth. Contact a local realtor to help you. If you are "upside down", then you need to call your current lender and try to negotiate a lower interest rate, or longer term.

I already called my lender and they told me I need to be behind in payments before they do anything. What do I do?

IF YOU CALL YOUR LENDER, THERE IS A GOOD CHANCE THAT THEY WILL TELL YOU THEY CAN NOT HELP. I think this is the first reaction that homeowners are getting. But the truth is that a lot of the lenders are willing to work with you, IF you talk to the right person, someone who has the authority to make that decision.

One of our clients had to call five times before they actually got in touch with someone who knew what they were talking about. Our client finally contacted the current lender and asked for a MODIFICATION OF their MORTGAGE. Some lenders will call it a Fresh Start program. Or perhaps the lender will convert the loan from an adjustable rate to a fixed rate mortgage. Even if you are behind on your mortgage or in foreclosure, some lenders will put the amount that your behind in payments on the back end of the loan.

With news in recent days, mortgage companies are beginning to reduce the principal balance of the mortgages. You may need to be persistent or explain the hardship of paying your mortgage payments before the lender will actually lower the payments. In some cases, we have already seen the lender reduce the principal balance to what the home is currently worth. This could be a huge savings to the homeowner, and may prevent a foreclosure altogether.

Not my lender they would rather take my home and foreclose?

Do not give up. Most mortgage companies do not want your home, they would prefer to work something out with you so they do not have to deal with a foreclosure. Bottom line - if you do not ask you do not get. Keep asking. Do not give up.

Ken Yoder - Branch Manager Guild Mortgage - Oakhurst

559 642-4200