You are not alone, many home owners in the Fall River Ma area are in the same boat as you. The economy, job losses, higher heating & gas prices and loan adjustments have forced many home owners to give up on their home.
You do not have to let your home go into foreclosure. Thanks to programs proposed by Fannie Mae many lenders are more willing to offer a Loan Modification from your bank. The bank may re finance the home at a lower rate making the loan more manageable. They may also extend the term of the loan or add on dellinquent payments to the loan principal . Your first step would be to contact your lender tell them you are falling behind & ask if a loan modification is available for you.
Section 1403 of the new housing bill that was signed into law on July 30, 2008 (HR 3221) requires mortgage servicers to modify loans for homeowners and help them avoid foreclosure as long as three requirements are met:
1. Default on the mortgage either has already happened or is “reasonably foreseeable”
2. The home owner is living in the property as his or her primary residence
3. The lender is likely to recover more through the loan modification or workout than by forcing the home owner into foreclosure
This law is effective immediately and most distressed home owners are simply not aware that they have this option. This law requires servicers to act in the best interest of all their investors and obligates them to modify your loan if you can afford the modified loan terms and if they are likely to recover more for their investors by working with you than by going all the way through the foreclosure process.
When negotiating a loan modification with your mortgage lender, it is advisable to follow this four step process:1. Make sure you are dealing with your lender’s loss mitigation and/or work out department.
2. Write a hardship letter demonstrating job loss, serious medical condition, balloon payment coming due, adjustable rate reset or some other financial calamity that will make it impossible for you to continue making your mortgage payments as scheduled. Unless you are in imminent danger of default as required by this new law, lenders are not likely to work with you.
3. Send the lender your financial statements, employment records, tax returns and bank statements demonstrating how you would be able to afford the modified loan terms under your present financial circumstances
4. Send the lender a current appraisal of your home or some documentation (CMA) on recent comparable sales in your neighborhood demonstrating the current value of your home. “The key is to demonstrate how the lender is likely to recover less money through foreclosure than they would by working with you in your proposed loan modification plan,” I would be happy to provide a CMA for you at no cost.
Here is a sample letter that you can use during your renegotiation:
http://www.cmpsinstitute.org/pdf/SampleLoanModificationRequest.pdf
It may be advisable to consult with an attorney - especially if you qualify for a loan modification under the law and your lender still refuses to work with you.
For more information, visit www.CMPSInstitute.org or call 888.608.9800.
If a loan modification is not available & you find you must sell your home I invite you to give me a call to discuss other options available to you. All enquiries are in the strictest of confidence. I can be reached at (508) 636-3310.
Sellers facing foreclosure that do not have equity in the home, meaning they owe more than the home is worth, should always consider a short sale.
Doing a "Short Sale" will avoid the embarassement, humiliation and stress of a foreclosure & help save your credit. A Short sale is putting your home on the market, at market value & asking your mortgage holder to take less or "short" of what is owed to them. Lenders prefer a short sale because it saves them time & money.
Benefits of Short sale over Foreclosure.
In a Short sale:
* negotiated settlement- the bank pays all fees including real estate agent
* seller's credit bruised May have 0 impact on credit
* no attorney fees
* peace of mind
* buy again in two years
* liens negotiated
Foreclosure
* court settlement advertised in the local newspaper (embarassing)
* seller's credit ruined, may not even be able to rent if credit check is done
* Hefty attorney fees
* no peace of mind- Can be put out of the home on short notice by a Sheriff
* Cannot buy again for 10 years
* all liens exhausted
Call me today at (508) 636-3310 for more information All calls are confidential and you are under absolutely no obligation. Or email me at KarenAnn If you are not located in MA or RI I can still refer you to an agent who can help.
Karen Ann Martin Full time Real Estate Agent Serving home buyers & sellers in Fall River, Somerset, Swansea,Westport, Dartmouth Ma real estate needs.
Home Sellers visit: www.ViewYourDreamHome.net for free market opinion of your homes value.
Home Buyers visit: www.KarenMartinHomes.com for free list homes for sale in Fall River Mass area
American Dream Real Estate Westport Massachusetts
* Disclaimer: This information is provided to give you an idea of your options. I strongly advise you to seek legal & tax advice from professionals in those areas .