FAQs:
If hardships programs have been available all this time, why hasn’t the lender already offered to help us?
The foreclosure department of most lending agencies is severely understaffed and they simply do not have the manpower to promote their willingness to work with you to save your home. In most cases, the lender will NOT make you an offer to enter into a hardship program, but rather, expects you to alert them as to why you have fallen behind on your mortgage payments.
Does the lender want to take our home?
In most cases, the lender does NOT want to take your home if it can be avoided. Often times, the owner of the loan is not the lending agency at all, but a private investor who will lose money if the foreclosure process is executed. The owner of the loan often uses pushy, callused, relentless collectors to scare you into paying them first.
Is negotiating with my lender still an option even though we are several months behind on payments?
ABSOLUTELY! Loss mitigation options are generally available to qualified homeowners regardless of how many months behind you are on your mortgage. However, it is important to start the process as soon as possible and try to avoid receiving a “Notice of Foreclosure Sale” or “Notice of Trustee’s Sale”. Once this notice is received/ posted, the lender may be able to charge you additional fees before the foreclosure can be stopped.
We cannot afford the fees that are incurred with a new loan and we probably wouldn’t qualify because of our credit. Does this exclude us from qualifying for negotiation with our lender?
Quite the opposite. Lenders expect to see credit problems with homeowners who are applying for a hardship program. Poor credit will NOT stop you from saving your home. The main qualification is a stable income that will allow you to make your mortgage payments. It is important to save as much money as possible to prove to the lender that keeping your home is your first priority.
Q. We thought we were being responsible by applying for help directly through our lender, but we keep running into issues and they have lost our application several times. Is the lender intentionally making this process more difficult?
A. Time is of the essence during a foreclosure. Though most of the time, it is not the goal of the lender to take your home, any situation that causes a delay of more than a couple weeks should be a signal that you need to seek third-party help. Over time, we have experienced the same issues as you. Fortunately, we have also found solutions. We have cultivated relationships with the lenders’ decision makers that allow us to go to the right people at the right time.
I know there are drawbacks to bankruptcy, but I also heard it will automatically stop a foreclosure. Wouldn’t it be easier to just BK all my debt?
No, no, no! Bankruptcy may be your worst alternative! Filing bankruptcy may erase bad debt, but it may not protect your property. For example, filing a Chapter 7 bankruptcy can enable the lender to complete the foreclosure by getting a “relief from stay on payments” from the courts. A Chapter 13 bankruptcy will cause your payments to go up for 36 to 60 months, and a large majority of homeowners fall out of the Chapter 13 repayment plan within a year. The high payments associated with Chapter 13 can put additional strain on the homeowner’s financial situation. Finally, if the bankruptcy court throws a homeowner out for non-payment, they can actually stop that homeowner from filing another bankruptcy down the road. Thus, there is no bankruptcy backup plan after all other options are exhausted.
We were offered a deal by the lender, but cannot afford the new higher payments and the large down payment they are asking for. If we decline their offer, do we have other options?
Yes! Do not accept a “plan” that you cannot afford. Unfortunately, most people in foreclosure will simply tell the lender what they think they want to hear, usually to the detriment of the borrower. However, because the lenders have very limited resources, it is best not to play hardball in asking the bank to restructure an offer. It is better to get it right the first time. That’s our job; to make sure it gets done right and that you get the best possible outcome available. During the delicate application process, it is imperative that the lender does not uncover any sensitive financial information that may disqualify you from a hardship program without a good faith review.
Loss mitigation options are geared toward a very specific type of homeowner who cannot only prove their need, but also prove that they have the ability to recover from the hardship that caused their mortgage delinquency in the first place. Again, we will work hard to negotiate your mortgage payments as low as possible.
We can help STOP FORECLOSURE in these States