Additional Foreclosure Avoidance Options?

Rent the Property. If your local market conditions will allow you to rent your home at or above the cost of your mortgage, renting the property and using the income to pay your mortgage could be an option.

Deed-in-Lieu of Foreclosure. Also known as a “friendly foreclosure,” a deed-in-lieu allows the homeowner to return the property to the lender rather than go through the contentious foreclosure process. Lender approval is required for this option, and the homeowner must vacate the property at a designated time.

Refinance. If you have sufficient equity in your property and your credit is in good standing, you may be able to refinance your mortgage at today’s historically low interest rates.

Service Members Civil Relief Act (military personnel only). If a member of the military is experiencing financial distress due to deployment, and that can show that their debt was entered

into prior to deployment, they may qualify for relief under the Service Members Civil Relief Act.

Sell the Property. Homeowners with sufficient equity can list their property with a qualified agent who understands the local foreclosure processes and is able to close a deal prior to bank foreclosing on the home.

What are Other Foreclosure Avoidance Options?

Foreclosure is one of the most devastating financial challenges that a family can face and many times, it can be avoided. A short sale is not the only alternative to foreclosure. Here are others:

Reinstatement. A reinstatement is the simplest alternative to a foreclosure—when it’s possible. Following a period of nonpayment, the homeowner simply pays the mortgage company the total amount due to date, and the mortgage is reinstated.

Forbearance. A forebearance is repayment plan that involves a negotiation with the mortgage company to make additional payments over a period of time in order to become current on the mortgage.

Mortgage Modification. A mortgage modification involves the reduction of one of the following: the interest rate on the loan, the principal balance of the loan, the term of the loan, or any combination of these. Be sure to never work with a mortgage modification company that requires an upfront fee. I can provide a list of HUD-approved counselors and mortgage modification resources.

Recognize the Red Flags!

The foreclosure crisis has given rise to a new breed of scam artist romising relief from foreclosure with any number of too-good-to-be true Promises. Much of what scammers asking unknowing victims to pay for, HUDapproved counseling agencies provide for free. Go to:

http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm to learn more.

Here are some guidelines to avoid falling prey to scams that can send your level of financial distress to an entirely level. When you receive an offer to help modify your mortgage, understand that there are never any

guarantees and don’t ever:

·· Pay a fee

·· Sign a contract

·· Sign over title to your property

··Redirect mortgage payments

··Stop making loan payments

And beware of anyone who says that you don’t need a real estate Professional or title company when selling your home. To report a suspected scam, call 1-888-995-HOPE (4673) and for more information visit

www.loanscamalert.org or www.preventloanscams.org.

Foreclosure: Not an Option

By definition, foreclosure is a legal process that results in the termination of all rights to the property held by the homeowner covered in a mortgage. The process, in which the lender claims ownership of the property, begins when the homeowner fails to ake mortgage payments when they are due—this is called delinquency. Typically, a formal demand for payment is issued from the lender through a Notice of Default. Although this varies by state, the lender will often issue this notice when the homeowner has been three months delinquent on the mortgage payments.

P.S – Some Lenders are not filing default in a timely manner. Extend & Pretend

Here are some of the main reasons why you don’t want to let your home go into foreclosure:

·· Foreclosure becomes part of the public record, and can remain on a person’s credit history for seven to 10 years.

·· Foreclosure can challenge future employment prospects.

·· Foreclosure can leave you at risk for future deficiency judgments, which is the lender’s ability to pursue any debts you owe them for an indefinite period of time

·· Foreclosure can even become an issue against security clearance.

(HAMP) Updates and Extension January 27,2012

As of January 27, 2012 ** New Changes

Deadline Extension: Deadline was Dec. 31, 2012 - **Deadline is Dec. 31,2013

Debt Ratio Eligibility Increase: Mortgage borrowers with debt ratio greater than 31% are eligible. ** Additional debts may now be taken into account, expanding eligibility requirements.

Rental Property Debt as Eligibility Factor: Rental properties are not included in eligibilty decisions. ** Rental properties (with or without tenants) may now beconsidered in eligibility decisions.

Balance Reduction off of Principle: HAMP will pay between 6 cents and 21 cents for every dollar that lenders take off of the mortgage principle. ** HAMP will increase the amount to between 18 cents and 63 cents for every dollar that lenders take off the mortgage principle.

Eligibility Requirements for Fannie Mae or Freddie Mac Loans : Loans guaranteed by Fannie Mae or Freddie Mac are not eligible. ** Fannie Mae and Freddie Mac guaranteed loans are now eligible under the new expansion of the program.

Eligibility Requirements that are still in place:

• Borrowers less than 60 days delinquent must be able to prove they are in imminent danger of default.

• If not in imminent danger of default, borrowers must be delinquent for 60 days or more.

• Mortgage must have originated on or before January 1, 2009.

• There must be affirmation of financial hardship