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I HAVE MISSED MY MORTGAGE PAYMENT(S), WHAT HAPPENS NOW? Foreclosure may occur. Foreclosure is a legal process your lender can use to repossess your home. If you owe more on your mortgage loan than your home is worth the lender may seek a deficiency judgment. If this happens, you not only lose your home, you can also owe the lender or HUD an additional amount. BOTH foreclosure and deficiency judgments could seriously affect your credit and the ability to qualify for credit in the future. You should avoid foreclosure if possible! I AM RECEIVING CALLS AND LETTERS FROM MY LENDER, WHAT SHOULD I DO? Respond to the letters and inform your lender of your situation. If your hardship is temporary your lender’s Loss Mitigation Department may be able to assist you. Do not abandon the property! You may not qualify for assistance or a short sale if the property is vacant. WHAT ARE MY OPTIONS AT THIS TIME? REINSTATEMENT During your 3-month reinstatement period you may bring the loan current by paying all past late fees, and applicable attorneys fees. REPAYMENT PLAN If you have the ability to make the current payment yet unable to catch up on back payments you may be eligible for a repayment plan. Repayment plans vary and are dependent upon loan type (FHA, VA, Conventional - ETC.) REFINANCE Though refinancing is an option, it is usually only possible if you have brought your mortgage payments current and you have equity in your home. Your payments are likely to increase rather than decrease. SHORT SALE If you do not have the equity within your home to satisfy a full payoff to your lender and the costs associated with selling your home (taxs, closing costs, brokerage fees, etc.) you may qualify for a “short sale”. A short sale is when your lender agrees to accept less than the current amount owed to release the lien against your home and will allow you to sell your home. DEED-IN-LIEU OF FORECLOSURE If your home is unable to be sold through a pre-foreclosure sale (including short sale) you may be allowed to deed the property back to the bank in exchange for a release. SHOULD I BE AWARE OF ANYTHING WHEN SEEKING ASSISTANCE? Yes. Beware of Scams. Solutions sounding too good to be true usually are. Unfortunately, there are people who may try to take advantage of an individual’s financial difficulty. Seek the advice of a licensed agent and be cautious of individuals who may be “equity skimming” and “phony counseling agencies”. EQUITY SKIMMING Equity Skimming is when a “buyer” approaches you, offering to rid you of financial troubles by promising to pay off your mortgage upon deeding the property over to them. The “buyer” rents your home leading you to believe a buyer has now moved in and you are released from liability however the “buyer” is collecting rents from the new tenant and allowing the lender to continue foreclosure proceedings. Remember, signing over your deed to someone else does not release you from liability of your mortgage obligation. PHONY COUNSELING AGENCIES Agencies may contact you and offer services for a fee that you may have the ability to complete yourself free of charge or make promises to pursue negotiations that they have no authority to. --- Time is critical once you begin to experience the inability to make your mortgage payment(s) in a timely fashion therefore it is of the utmost importance you contact your lender or that of a licensed real estate agent who will provide options to salvage your credit and work for you rather than against you. Hardship does not target an individual social status, income range, and or race and ethnicity. It is up to you as an individual to act immediately to become informed as the option that may benefit you and your family. Contacting a licensed and reputable Realtor for a consultation will incur no charges and/or obligations. Get the facts first. For additional answers to your real estate needs contact Mark Feigh of Re/Max Associates 801-231-8179 or e-mail him at markfeigh@remax.net Information provided is for informational purposes only and should not be substituted for legal, financial, or tax advice. Any and all financial decisions and actions should be done through the advice and counsel of a qualified attorney, financial advisor and/or CPA. We cannot be held responsible for actions you may take without proper financial, legal or tax advice. |
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