How To Stop Foreclosure: Tips On Saving Your Home

Foreclosure occurs when borrowers default on their mortgage payments and wind up owing more than their home is worth. The bank relinquishes ownership of the home and the borrower has no choice but to walk away and accept a huge loss. Not only does foreclosure affect their financial security and credit score, but it also affects the security and stability of their families. Often, when foreclosure occurs, families are left out in the cold.

It is the absolute worst case scenario, and homeowners should take every possible measure to prevent it from happening to them. But can homeowners learn how to stop foreclosure? These following methods may help if you find yourself in dire straits.

One method is by writing a hardship letter to send to your bank. Careful thought should be put into this letter, as it must adequately explain your hardships and the reasons why you are behind in your payments. In the letter you can ask for extra time to catch up on your mortgage payments. If your hardship letter is written correctly, the bank may grant your request. This method can also be used to initiate a short sale rather than a foreclosure. You can write your hardship letter yourself or hire a legal professional to do it for you.

Have you heard the term “produce the note”? You may be wondering how to stop foreclosure using this technique. Basically, it involves demanding that the financial institution produces the original mortgage note that you signed when your bought your home. It comes as a shock to most people just how many banks lose or throw away this important document. Over time, mortgages are sold and resold, cut up, and made into bonds. After a while, the identity of the true owner becomes unclear.

If the banks cannot provide proof that you are the original owner of the home, the foreclosure proceedings cannot continue until the note is provided. This can delay the foreclosure for months. In some cases, foreclosures have been entirely prevented by employing this method.

Another important method to learn is how to stop foreclosure using loan modification programs. Depending on your situation and level of hardship, you may be able to defer payments or extend your home loan, which may prevent you from having to go through foreclosure proceedings.

The best thing to do if you are looking for ideas on how to stop foreclosure is to talk to a trusted professional who can sit down with you, look over your case, and discuss your options. Foreclosure and real estate law is a complicated matter that requires the knowledge of a qualified expert. Don’t resign yourself to your situation: there are solutions available if you are willing to look for them.

The Homeowner Bailout Gives Borrowers a Chance

Obama’s homeowner bailout plan, announced in February 2009, shortly after signing his monumental economic stimulus plan, offers to lend a helping hand to homeowners in need. His plan aims to address several issues which have kept homeowners at a disadvantage when it comes to keeping up with their monthly mortgage payments. The homeowner bailout, or “Homeowner Affordability and Stability Plan” as it is properly called, offers help to borrowers so that their monthly mortgage payments are reduced and they can stay in their homes rather than face foreclosure.

The plan was officially launched in March of 2009. Since then, over 729,000 homeowners have been accepted into the program and are in the process of renegotiating their mortgage loans with their lenders. Only a small fraction of the homeowners taking part in the homeowner bailout plan have completed the application process and have now permanently lowered the monthly rates of their mortgages. The rest are still in what is called the “trial period”, in which borrowers must keep track of their payments and send documentation regarding their new mortgage plans to the government.

The homeowner bailout plan addresses issues that have helped create the foreclosure crisis. One cause is massive unemployment figures, leading to a wide array of people who find themselves unable to pay their mortgage. This in turn leads to an unprecedented number of foreclosures. With each new foreclosure, the value of surrounding homes in the neighborhood is lowered by 9%, causing a bit of a snowball effect. With rising interest rates, lowered home values, and lowered income overall, more foreclosures are occuring at an alarming rate. Homeowners then find themselves unable to refinance due to weakness in the credit market.

To fix these growing problems, the homeowner bailout plan uses various methods to stabilize the foreclosure crisis. It works by providing affordable refinancing to homeowners who would not otherwise be eligible to receive it. It also lowers their monthly mortgage payments to 31% of their monthly income by lowering the interest rate and potentially extending the life of the loan. The homeowner bailout plan also offers banks financial incentives to take part in the program, and offers borrowers $1000 for each year they remain current on their mortgage.

Many have criticized the homeowner bailout program for being too complicated and difficult for homeowners to apply for and receive. However, loan modification companies exist that can organize all of the documentation needed to correctly apply for the program. This greatly increases the chances of homeowners being accepted into the program and locating the help they so desperately need to stay in their homes and avoid foreclosure!

So if you need help paying your monthly mortgage payments, read as much as you can about the homeowner bailout program, and if necessary, find a good loan modification company that can help you file your claim.

New Loan Modification Program For Homeowners

In light of the recent economic downturn, President Obama has issued a new loan modification program that aims to help families manage their monthly mortgage payments and prevent their homes from going into foreclosure. This is a much needed step in the right direction from the federal government to try to offer assistance to the homeowners who need it most. The government has allotted 75 billion dollars towards this program. Banks that provide new loan modifications to their borrowers will be rewarded monetarily by the government.

How does this new loan modification program work? First of all, a loan modification is a permanent change to a home loan that restructures the loan to better fit the financial situation of the homeowners. If they are behind on their payments, the money owed will be reintegrated into the overall loan and spread out to make the loan current.

However, homeowners do not necessarily need to be delinquent on their payments to qualify for a new loan modification. If they appear to be at risk of falling behind, they are eligible to receive help.

In order to qualify for a new loan modification, borrowers must prove that they suffer from hardships that prevent them from adequately keeping up with the home loan as it exists currently. They also must prove that their income is sufficient to keep up with the terms of the new loan if a modification takes place.

Borrowers must be able to offer proof in the form of tax returns, bank statements, bills, and monthly expenses. Virtually every document related to financial matters must be presented so that an accurate case can be made. The borrowers must also prove that they are suffering from hardship in some form or another, which can be communicated through a well-written hardship letter to the bank.

Simply being unable to pay your bills is probably not enough to qualify as a “hardship”. What the banks are looking for are events such as death, illness, losing your job, or divorce. In particular, they are looking for situations which are out of your control that would hold you back and prevent you from making proper timely payments.

If you wish to apply for a new loan modification, it’s recommended that you conduct lots of research on the subject and contact loan modification professionals to help you put together your application. Although you can apply for a modification yourself if you want to, it’s generally a better idea to use the advice and expertise of legal professionals. They can better ensure that your application is organized and presented correctly, allowing for a higher probability of acceptance.

If you are at risk of facing foreclosure, take advantage of the help that the government offers before it is too late!

Short Sale Vs. Foreclosure: How Do They Compare?

Short sale vs. foreclosure is a decision that many have to weigh. Over the last few years, millions of Americans have experienced difficulty paying their mortgages and staying on top of their monthly expenses. This combined with falling housing prices and rising interest rates lead to homeowners owing more than their homes are actually worth. It is a very challenging situation and the parties involved must decide between two options: short sale vs foreclosure.

Foreclosure is a legal proceeding which allows the bank to take back the title of the mortgage from the homeowners and resell it in order to recoup for losses. In this case, the homeowners have no choice but to simply walk away from their home. They gain nothing in a foreclosure. The money they put into their home is lost and their credit score is negatively affected.

A short sale is a bank-issued discount on the balance of the mortgage due to hardship on the part of the homeowner. The homeowner then must sell the property at this discounted price and turn over proceeds to the bank. In this case, the bank takes less of a financial hit, and the homeowner’s credit history is not affected too adversely.

So how do you decide between a short sale vs. foreclosure?

Foreclosure is probably the easiest option, because the borrower simply relinquishes all control and ownership of the home, turns it over to the bank, and walks away. With a short sale, the borrower is still responsible for selling the home. This could be considered either a good or a bad thing. Most homeowners like retaining some control and knowing who will buy their home. They are also able to avoid the stigma of foreclosure.

However, they still do not benefit monetarily or otherwise from a short sale. They are still taking a loss.

One major deciding factor in short sale vs. foreclosure is the borrower’s credit history and ability to buy a new home. With foreclosure, their FICO score can drop between 200-400 points, a devastating blow that can take years to repair. They also must wait between five and seven years before they can be considered for another home loan.

With a short sale, homeowners do not experience a drop in their credit score beyond that which occurs from being behind on their mortgage payments. They also may be eligible to buy a new home within a couple of years, in some cases immediately. Overall, a short sale is not nearly as harsh on a homeowner as is a foreclosure.

Any homeowners unable to keep up with their mortgage owe it to themselves to become educated on their options concerning short sale vs. foreclosure. This is not an easy matter to handle, but with knowledge comes power.

Loan Modification 2010: What To Expect

In March 2009, President Obama launched his MHA program: Make Home Affordable modification plan. The purpose of this plan is to help distressed homeowners manage their monthly mortgage payments and avoid facing foreclosure. Since then, hundreds of thousands of homeowners have been able to successfully apply loan modifications to their mortgage loans. However, this only serves as a small dent in the huge and ever growing number of homeowners facing foreclosure in this country.

What’s in store for loan modification 2010?

It’s hard to say exactly, but experts from the Federal Housing Finance Agency predict that loan modifications in 2010 will continue to increase, and more modifications will pass from the trial stage to the permanent stage. Currently there are over 700,000 loan modifications underway, but only 31,000 of those have passed through the trial stage and become permanent. For those whose loan modifications are complete, they face monthly mortgage payments lowered by 20% on average.

Obama’s loan modification plan works by lowering the monthly mortgage payment to less than 31% of the borrower’s total monthly income. First the interest is lowered as much as it needs to be, down to 2% at the most – if this is not enough to lower the payment to 31%, the terms of the loan are extended to 40 years. Banks that engage in the program are to receive cash incentives – $1000 initially, as well as $1000 per year up to three years, assuming the borrower continues to make timely payments. The borrower will also get $1000 knocked off the principle for each year they pay on time.

The Make Home Affordable plan relies on homeowners to stay in their homes as long as they can afford to make the payments. It also relies on banks to actively engage in the program and not be stingy or difficult with the borrowers.

Although the program appears to be working for many, banks are generally slow to act on this program, and many homeowners report that the process of organizing and filing for a loan modification is monumental. However, the risk a homeowner takes by not applying for a loan modification in 2010 can be immense, and as a result, foreclosure may be unavoidable.

Loan modification 2010 can be made less difficult and time-consuming by hiring a loan modification company to put together all the paperwork and offer expert advice. For a layman attempting to put together a 2010 loan modification, it can be incredibly complicated and the rate of failure is high. A loan modification company will ensure that the applications are properly organized, in the right order. They can also tell you what to expect given your particular circumstances, and what other options you may have in order to prevent foreclosure.

Visit our homepage if you would like assistance with your loan modification.

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Are you facing foreclosure? If you have received a notice from your lender that your home sale is pending, you must act immediately. Time is of the essence in these matters. We can help you stop foreclosure, but we can only do this for so long. If you wait until it’s too late, there may be nothing we, or anyone, can do and you will lose your home.

While we have stopped foreclosures sales that were happening in just 24 hours, it is MUCH easier and a MUCH better idea to start this process earlier. This allows more time to act and make sure we get the job done.

One of the fastest and most successful ways to stop foreclosure is by using “produce the note”. We offer this service at a very affordable price and if we are not successful we offer a 100% money back guarantee. This will not stop foreclosure forever, but will postpone the process long enough to figure out if you want to pursue a loan modification or try to negotiate a short sale to save your credit report from having a damaging negative mark for years to come.

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Here is a video that goes over this subject in a little more detail:

If you have a loan with EMC and are looking to get a loan modification, you’ve found the right place. You may be able to substantially lower your monthly mortgage payments with a modification. And with EMC, we can get your loan modified incredibly fast…just a few days.

Emc Loan Modification Calculator

If you are reading this from our blog at theloanmodificationcompany.org, just click on the tab that says “Home”. From there, you will see the loan modification calculator. Just fill out a few easy lines on the form and it will tell you if you qualify and what your new payment would be.

This calculator is based off of the HAM program guidelines. Using this program will allow you to lower your monthly payments to a maximum of 31% of your net monthly pre-tax income. This is accomplished with a few steps, usually by lowering the interest rate to 2% and/or extending the terms of your loan by up to 10 years.

This is not an easy program to qualify for on your own. Many homeowners have received notices from the lender stating that they do qualify for help, only to find out that when they call their lender they are denied. This is most likely due to the fact that they do not know how to prepare their financial information according to the proper ratios. You have to get it just right to fit into these guidelines.

We know what it takes to get your EMC loan modification approved. If you would like further assistance and a free consultation to see if we can help, then just give our toll free number a call or fill out our contact form. We will be able to tell you if you are approved as soon as we make contact with your lender and you will not be charged until the loan modification is completed.

Regards,

TheLoanModificationCompany.org