Ben Maddy

LOAN MODIFICATION FRAUD IN WASHINGTON

With loan modification being the fastest growing business in America, loan modificationfraud is likewise looming over distressed homeowners in Washington. Modificaton companies charging to negotiate with the bank on behalf of the borrower have become increasingly prevalent, and fraud has become an epidemic. Many homeowners who have fallen victim to loan modification fraud in Washington state are left feeling worse off than before, having wasted a great deal of valuable time and money on a false hope. With all the shady companies to search through it is very important to find a reputable, legitimate and registered servicer.

Right now the most common loan modification scam involves unscrupulous servicers promising homeowners a lower interest rate by reducing the principal or monthly payment. More often than not, these homeowners end up in worse shape than before with fraudulent companies walking away with their money. Legitimate, local housing counselors are able to offer free services and information for distressed homeowners facing foreclosure. In the end, professionals agree that being well-informed is the most useful defense against foreclosure.

Due to rising loan modification scams, the Obama Administration has begun a coordinated effort across federal and state government and the private sector to target mortgage loan modification fraud and foreclosure rescue scams. The Department of Financial Institution has advised homeowners to make sure their loan modification provider is licensed as a loan originator prior to using any of their services. Borrowers may verify a license at http://www.dfi.wa.gov/ and may also seek free homeownership counseling.

By confirming whether or not you qualify for the Obama Plan, Washington homeowners can immediately discover the savings and payments available under the various programs now helping homeowners save their home.

All Washington homeowners now facing foreclosure, and those who are about to be, should immediately begin exploring all the options available to them, including the new government programs designed to help you get a successful loan modification.

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LOAN MODIFICATION HELP FOR HOMEOWNERS IN WASHINGTON

As fear grows that there is no loan modification help for homeowners in Washington, the number of U.S. households faced with losing their homes to foreclosure jumped 32% in just one month last April. More than 342,000 households, or one in every 374 U.S. housing units, received at least one foreclosure-related notice in April, 2009. Once the banks take over the foreclosed homes, they commonly place the house for sale at a substantial discount from market rate, and coincidentally continue to devalue the housing market. [MSNBC, 5/12/2009]

Foreclosure rates are now lower than half the country, but unless loan modification help for homeowners in Washington state comes soon, foreclosures may explode in number. Higher populated areas of Washington State, such as Seattle, Tacoma, Bellevue, Olympia, Vancouver, or Spokane, will experience the worst of it. In January, 2009, Washington homeowners entered foreclosure at a higher rate than the national average, recording 2,200 foreclosure filings, which is a 9 percent increase from December. [Seattle Times, 2/26/2008]

While many homeowners are forced to sell their homes at a loss, some have renegotiated their mortgage, and others have just walked away, letting the bank take over. Such problems are reaching across all types of neighborhoods in Washington State, with Pierce County and South King County experiencing the most foreclosures as property values in that area dropped more than 25 percent since 2007. [Seattle Times, 4/26/2009]

As suggested by Sheila C. Bair, chairwoman of the Federal Deposit Insurance Corp., and reported by the WA Post, "the government set out a standardized loan modification package for loan servicers to follow, enabling them to do workouts faster. In return for their picking up the pace, the government would guarantee some or all of the newly modified loans." [WA Post, 10/26/2008]

Though many believe there is no loan modification help for homeowners in Washington state, there is assistance for those who take immediate action. Whether in the form of loan modification, a secure short sale, streamlined refinancing, or another loss mitigation workout agreement, exploring all the options is the best approach for homeowners. Under President Obama's "Making Home Affordable" plan, homeowners can save hundreds a month by getting a home loan modification or mortgage refinance.

Every Washington homeowner who is facing foreclosure, and those about to be, should immediately confirm if they qualify under the Obama Plan, and begin exploring all the options available to them, including the new government programs designed to help you get a successful loan modification.

RELATED BLOGS:
Free Washington Loan Modification Evaluation
Loan Modification Scams in Washington

AVOIDING FORECLOSURE IN WASHINGTON

Many Washington homeowners are in over their heads with unaffordable payments and overwhelmed trying to avoid foreclosure. However, a number of them find that avoiding foreclosure while obtaining a more affordable loan is easier than they think. As reported in the media, Under the Obama administration's new regulations, the government will now subsidize the cost of lowering a homeowner's interest rate in order to maintain their payment to no more than 31 percent of their income. [NY Times, 3/5/2009]

"The government will also help subsidize the cost of lowering the borrower's interest rate so that payments are no more than 31 percent of their income. A loan can be modified only once under the program, and borrowers must prove they have a financial hardship." [WA Post, 3/5/2009]

Loan modification has become the best option for homeowners facing foreclosure, because loan modification allows for permanent changes to be made to the loan, allowing for more affordable payments. In doing so, Washington homeowners are able to avoid foreclosure and keep their family home.

Nearly everly Washington homeowner now qualify for hundreds of dollars in monthly savings with a loan modification under the Obama administration's "Making Home Affordable" plan. Thanks to the HAMP program, a homeowner's mortgage payment cannot exceed 31% of their gross income, and because most home loans exceed 31%, the majority of borrowers are eligible for assistance. Washington homeowners facing foreclosure, or about to be, should immediately begin exploring all the options available to them.

FORECLOSURES AND HOME VALUES IN WASHINGTON

As foreclosures influence falling home values in Washington, homeowners are currently watching more and more For-Sale signs sprout up in front of houses in their neighborhoods. In the past three months alone, approximately one million homes were foreclosed. Washington's housing market is following the trend of states like California, as home values fall due to foreclosures. [Reuters, 6/11/2009]

Skyrocketing interest rates caused by Adjustable Rate Mortgages shifting to exuberantly high rates have pushed borrowers into a corner. Many find that they owe far more than their home is now actually worth, and there seems to be not end in site. Home values are down 32 percent since the second quarter of 2006, and U.S. households saw $1.3 trillion of their wealth vanish during the first quarter of 2009 alone. [AHN, 6/11/2009]

As Washington housing prices continues to decrease, market competition likewise is thriving due the vast numbers of homes selling far below market price. Coincidentally, selling is no longer an option for these homeowners.

Inside this competitive and undervalued market, homeowners unable to refinance are now forced to walk away from their homes due to foreclosures. While foreclosures continue to impact the home values in Washington, loan modification is the only possibility for most homeowners to get out of their downward spiral.

The majority of Washington homeowners now qualify for hundreds of dollars in monthly savings with a loan modification under the Obama administration's "Making Home Affordable" plan. Thanks to the HAMP program, a homeowner's mortgage payment cannot exceed 31% of their gross income, and because most home loans exceed 31%, the majority of borrowers are eligible for assistance.

Washington homeowners facing foreclosure, or about to be, should immediately begin exploring all the options available to them.

FREE LOAN MODIFICATION COMPANIES, WASHINGTON

Many Washington homeowners have now heard about the free loan modification services being offered to borrowers thanks to President Obama's new loan modification and housing market plan. A large number of certified "non"-profit organizations have been licensed and given incentive by the government to help the American public modify their home loan.

Even though lenders and borrowers tend to mutually benefit from a home loan modification, dealing with those lenders is frequently difficult if not impossible for homeowners attempting loan modification alone. Due to the massive volume of borrowers requesting help from "non-profit" loan modification companies, most requests are lost in the shuffle and never get the help they require. Each and every foreclosure case requires individual attention from an advocate, and, with thousands of requests coming through, many are automatically denied or placed in "cookie-cutter" plans resulting in a worse situation for the borrower than before.

Under President Obama's "Making Home Affordable" plan most Washington homeowners now qualify for hundreds of dollars in monthly savings with a loan modification. The HAMP program demands that a homeowner's mortgage payment cannot exceed 31% of their gross income, and since most home loans exceed 31%, the majority of borrowers are eligible for assistance.

All Washington homeowners now facing foreclosure, or about to be, should immediately begin exploring all the options available to them, including the new government programs designed to help you get a successful loan modification. Under new government programs, homeowners can save hundreds a month by getting a home loan modification or mortgage refinance.