People facing foreclosure do have options, local lenders say.
“People have to call their lenders. That’s the key,” said Dennis Edson of Unifirst Mortgage in Grand Junction. “Lenders should be talking to the buyers because most lenders do not want that house back. Most of them will negotiate with you, but they want to be sure you have some real problems.
“If somebody loses their job and the house value has gone down and they have a $2,000 house payment, maybe they can put you at $1,200.”
Edson’s company will be publishing a brochure soon about what people in facing foreclosure can do. He advises they call the U.S. Department of Housing and Urban Development Foreclosure hotline or Grand Valley Housing Initiatives for counseling.
Nancy MacIntosh, of Catalyst Lending in Grand Junction, advises people in a potential foreclosure situation, where they may be a few months late on payments, to ask their lender if they can get into a Federal Housing Administration program that considers those who were fine on payments before their interest rate changed.
MacIntosh said she took a recent workshop on advising clients about credit, and her advice to clients is: “Tackle your credit report.” MacIntosh said one of the most important consumer tips is that people should file in small claims court against institutions that had unsubstantiated negative effects on their credit report, to at least get the information cleared.
She also said potential home buyers should shop around when looking for lenders because “even the big lenders are really charging a lot in closing fees that they really don’t have to do.”
Although lenders are in the business of making money, they don’t stand to gain from foreclosures.
“The lending agencies are really trying hard to make the borrowers aware of some of the other options they might have to try and cure the loan,” said Paul Brown, public trustee for Mesa County.
Facing Foreclosure
Unifirst Mortgage advises anyone facing foreclosure and seeking help to call the U.S. Department of Housing and Urban Development Foreclosure hotline at 877-601-HOPE (4673) or Grand Valley Housing Initiatives’ Merle Allen, director of counseling, 970-263-7327.
Steps for recovery
HUD recommends doing the following if you are unable to make your mortgage payment:
1. Don’t ignore the problem.
The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house.
2. Contact your lender as soon as you realize you have a problem.
Lenders do not want your house. They have options to help borrowers through difficult financial times.
3. Open and respond to all mail from your lender.
The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notice of pending legal action. Your failure to open the mail will not be an excuse in foreclosure court.
4. Know your mortgage rights.
Find your loan documents and read them so you know what your lender may do if you can’t make your payments. Learn about the foreclosure laws and time frames in your state by contacting the State Government Housing Office.
5. Understand foreclosure prevention options.
Valuable information about foreclosure prevention options can be found on the Internet at portal.hud.gov.
6. Contact a HUD-approved housing counselor.
HUD funds free or low-cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender if you need this assistance.
7. Prioritize your spending.
After health care, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment.
8. Use your assets.
Do you have assets — a second car, jewelry, a whole life insurance policy — that you can sell for cash to help reinstate your loan? Can anyone in your household get an extra job to bring in additional income? Even if these efforts don’t significantly increase your available cash or your income, they demonstrate to your lender you are willing to make sacrifices to keep your home.
9. Avoid foreclosure prevention companies.
You don’t need to pay fees for foreclosure prevention help that your lender or a HUD-approved housing counselor will provide free if you contact them. Use that money to pay the mortgage instead.
10. Don’t lose your house to foreclosure recovery scams.
If any firm claims they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf, you may well be signing over the title to your property and becoming a renter in your own home.
Source: U.S. Department of Housing and Urban Development.
Email ANNA MARIA BASQUEZ
