Avoid Foreclosure
If you are reading this it is likely that either you, a friend, co-worker or family member is struggling to make the monthly mortgage payments. Millions of Americans are currently having the same difficulty. Due to the magnitude of the problem, the Federal Government and many of the nation’s Lenders will now help in ways they’d never consider before this national crisis developed to the critical stage we see we are at now; where banks are afraid to lend to other banks, freezing the credit markets and requiring the US to partially nationalize the banking system.
Despite this troubling situation, or in some ways because of it, there is hope for homeowners who want to keep their homes. The problem has become so large, with so many homes already foreclosed on and now owned by the banks, that they really do NOT want your house. Some of the banks are now ready to cut deals with mortgagors that they’d never consider doing before. The Federal Government will now insure lenders who help refinance homeowners into lower rate or fixed rate loans that will help them save their homes.
Homeowners needing help fall into three categories that it appears do not overlap very much if at all.
The first category is homeowners with little or no equity in their homes, with monthly debt to income above the ratios that lenders consider safe, and with low credit or FICO scores. These homeowners will need to renegotiate their original deal with their lender. This category of homeowner will not qualify for a new loan to refinance their way out of trouble because they lack sufficient income, collateral or creditworthiness as measured by their FICO score.
The second category is homeowners who are proactive. They have not missed a payment yet, they still have at least 10% equity in their homes, and they still have a high FICO credit score. However, they are savvy enough to know that their situation could deteriorate if they did act now to reduce their interest rate and monthly mortgage payments. These homeowners know that they can do a conventional refinance now, but that their situation could deteriorate to the point where they fall into a higher credit risk category if they do not act soon.
The third category only exists because of new guarantees by the Federal Government. Because of programs like FHA Secure, homeowners who have missed a few mortgage payments in the past year but are not yet more than 90 days behind can qualify to refinance their way out of their Adjustable rate or higher rate mortgage loan into a lower rate fixed loan. A potential borrower with late payments on their mortgage would not ordinarily be approved for a new loan.
If you are in the first category and are prepared to tackle this problem on your own, the first thing you want to do is contact the lender who is currently servicing your home loan. You would tell them your situation so that they can see if they don’t work with you, they will be stuck with another home that they cannot sell. You can also contact a HUD-approved foreclosure housing counseling agency. Call toll free 1-800-569-4287 or TDD (800) 877-8339 for the housing counseling agency nearest you.
Almost any lender can help those in category two. You just want to do some shopping for rates and fees and have a Loan Officer like myself monitor the daily changes to rates and lock you into the best deal possible. This is currently the most volatile environment for mortgage interest rates seen in the history of the industry.
Any knowledgeable Loan Officer working with an FHA Approved lender can help those in category three. However, not all lenders are FHA Approved, and not all Loan Officers are knowledgeable in this area. There are many specialties within the industry; with numerous residential and commercial loan products, so no one can be an expert on everything. I have taken it upon myself to shift my focus from Energy Efficient Mortgages, which I still do but currently on the commercial side, to the FHA programs that can help Americans keep their homes. It is first things first; you cannot have a green home if you don’t have a home at all.
If you are still uncertain about the best course of action or just want some help going over your options, you can contact me for a free evaluation of your situation by clicking here and filling out the short form as completely as possible. I will get back to you right away since time is of the essence.
