Stop Foreclosure Answer

Did you hear about the lady in Tennessee?

A widow and a senior citizen she has lived in her home for the last 32 years. Needless to say her income is fixed and she fell behind on her mortgage payments. Her mortgage company, Wells Fargo, started foreclosure and her home was scheduled to be auctioned off at the end of May.

Her community rallied to help her save her home. A local mortgage company took on her case and is trying to get her a reverse mortgage. The challenge is that the property values in her community have fallen significantly. The mortgage she can get is $30,000 short of being able to pay off her loan with Wells Fargo. The balance on that loan was $123,000.

A local church scheduled a car wash to try to raise enough cash to save her home. In my opinion they would have had to wash quite a few cars to raise enough money to even put a slight dent in the amount that she was short.

Wells Fargo indicated that they had tried quite a few loan modifications with this woman and they failed.

Her home is now scheduled to be auctioned off on June 26.

I wonder what type of modifications Wells Fargo offered this woman. Were they serious attempts to help her or were they just attempts to have her pay the amount that she had fallen behind and then resume making her monthly payments again?

If Wells Fargo had talked to her about a reverse mortgage earlier before the property values had dropped could she have gotten more and would the shortage have been less?

Would Wells Fargo and their lawyers consider forgiving a portion of the shortage on the mortgage? $30,000 is a huge difference on a $123,000 mortgage. The proceeds from the car wash probably came nowhere near that amount. If Wells Fargo takes the home through foreclosure, how much would they be able to sell it for? Would they lose more on it than they would by accepting whatever she could offer?

It does not look like this lady ever got a lawyer or an expert in loan modifications to help her. If she did, she may not have been in the bind that she is now.

If you are facing foreclosure, you may think that you don’t need outside help. You can just negotiate with your mortgage company. Just remember that the people at the mortgage company are protecting the interests of the mortgage company. They are not working in your behalf. They may offer you a loan modification that may not be in your best interests.

Don’t become their victim.

Much Success,

Mark Elkins

I just want to warn you. What I have to say today may disturb you. These statistics are really frightening.

The Center for Responsible Lending just estimated that from the beginning of 2009 to June 1 over 1 million new foreclosures have been filed in the United States. That is just about 200,000 a month.

There is a new foreclosure every 13 seconds.

6,500 new foreclosures start every day.

2,400.000 foreclosures will start in 2009.

2009 property values will drop by $502 billion.

By the end of 2012 there will be 9 million new foreclosures.

Property values will drop $1.9 trillion by the end of 2012.

What does all this mean?

First – it is going to be very difficult for mortgage companies to keep up with the requests for loan modifications that they are going to receive. They are going to have to increase the size of their staffs tremendously to handle the volume.

Second – The amount of time it is going to take to get a loan modification is going to be very long.

Third – With new inexperienced people at mortgage companies working on these files, the quality of the work will be questionable. The modifications that will be made will probably not be as good as they can be. Many people facing foreclosure may not be offered as low a monthly payment as necessary based on their circumstances. The number of people defaulting again will continue to remain high.

General Motors has just declared bankruptcy. 21,000 of their workers will be let go nationwide. Many of General Motors’ suppliers will be forced to downsize too. No one knows how many of their employees will be let go. Some of these people will be facing foreclosure. Did the Center for Responsible Lending include these in their estimates?

The picture is not good. Much trouble lies ahead. If you are facing foreclosure, you want to do all you can to protect your family and save your home. Don’t try to do it yourself. Get help from a lawyer or an expert.

Much Success,

Marl Elkins