Stop Foreclosure Answer

Over the last year and a half the Federal Deposit Insurance Corporation (FDIC) has taken a very proactive role in helping people save their homes from foreclosure.

After they took over IndyMac Bank. a failed mortgage lender, last year they suggested the model for loan modifications from which the current Making Home Affordable Modification Program evolved. 

The FDIC has just announced their latest effort in this area.  They have put together a Foreclosure Prevention Toolkit.  This toolkit is designed to help people facing foreclosure save their homes.  It helps them to understand who to contact and what documents they will have to submit if they apply for a loan modification.  It also helps them to identify when companies contacting them and offering help to save their homes are doing nothing more than ripping them off.

Contents of FDIC’s Foreclosure Prevention Toolkit

What has the FDIC made available with this kit. The kit contains two brochures. 

The first talks about loan modification programs and how they work.

The second deals with Foreclosure Rescue Scams.

It also contains a copy of the spring 2009 edition of the FDIC Consumer News.  This has advice for people on how to avoid foreclosure rescue and loan modification schemes.  The last piece in the kit is a connection to FDIC’s Your Own Home Module in their Money Smart curriculum which has has more useful information.

Other Valuable Resources from FDIC

THE FDIC also has included valuable resource information on foreclosures for consumers, community organizations and financial institutions.

The FDIC is working with community organizations and banks to make the public aware that this toolkit and resource information is available.  It was not that long ago that when the government put together information like this, a person had to send away for it.  It took 3 to 4 weeks before they got it.  Not here.  Anyone can get the kit over the Internet.  The link to the website is www.fdic.gov/consumers/loans/prevention/index.html.  Of course the FDIC is also providing it in printed format.

The information that the FDIC is providing is more general in nature and does not go into detail on what to do to save a home from foreclosure.  You will have to look to other sources for that.  One place you can get this more detailed information is my EBook.  You can get more information on it by clicking Stop Foreclosure.

Much Success,

Mark Elkins

Did you see this article on YAHOO! NEWS the other day?  The headline was

Wells Fargo fires exec over Malibu house scandal

The executive was a senior vice president who was responsible for their foreclosed commercial properties.  They terminated her for violating their policies.  They added that her conduct was not what they expected from team members. What did she do?

She Held Lavish Parties At a Foreclosed Home

Owned by the Bank on the Beachfront at Malibu

Evidently there is a 3,800 square foot home on the beach in Malibu that the previous owners purchased for $12 million.  They had invested their money with Bernie Madoff and lost it all.  They could no longer keep up with the mortgage payments and Wells Fargo was forced to foreclose.  Wells Fargo took possession of the home last May and kept it off the market for a certain period of time.

This senior vice president saw an opportunity and started to host weekend parties at it.  The parties were lavish.  For one party the guests were expected to arrive by boat.

In a statement Wells Fargo apologized for this executive’s actions.  They added that this was not what they expected of their employees.

Wait A Second

How does Wells Fargo monitor the homes which they have taken over as a result of foreclosure?  It sounds like there were a series of parties.  How could they be blind to what was happening?  What has happened at other homes which Wells Fargo now owns?  

$25 Billion Bailout From the Federal Government

Poor Performance in the Making Home Affordable Modification Program

This is the same Wells Fargo that received $25 billion from the Federal Government last year as part of the bailout for financial institutions.  This is the same Wells Fargo that is performing so poorly in the Making Home affordable Modification Program.  Through August they have only offered trial modifications on 9.54% of the approximate 367,000 loans that are eligible for these modifications.  On the one hand they are not helping people in foreclosure who need help.  On the other hand their employees have started to misuse homes which they have taken over as a result of foreclosure. 

Does This Seem Like a Company You Can Trust?

I would have to say no.  If your mortgage is with Wells Fargo and they have started to foreclose on it, you cannot trust them to work with you and help you set up a plan to stop the foreclosure and save your home.  Don’t think that there is any way that you can represent yourself and negotiate with them.  It looks like the deck is stacked against you right from the start.  The longer you try on your own the more you have to lose.  You will be hurting yourself and your family members.

Hire a lawyer or an expert skilled in loan modifications to represent you.  That is the best chance you have to save your home.  These people are skilled at working with all of the mortgage companies and know what to expect. 

I also suggest that you learn as much as possible about the foreclosure process and the steps that can be taken ways to save your home.  One resource available to you is my EBook.  You can find out more about it by clicking Stop Foreclosure.

Much Success,

Mark Elkins    

I don’t know if you picked up on it.  It was really subtle.  What am I talking about?

One of Bank of America’s Recent Money And Main Street Commercials

I was watching the late night news here in Chicago in early September.  One of the commercials that came on was a Bank of America Money And Main Street commercial.  Evidently they have teamed up with CNN and Money magazine on a series of commercials.

The one I am talking about shows a brief clip of a priest in California who has been working to help people in his church save their homes from foreclosure.  At the end of that clip it refers the person watching it to www.CNN.com/MoneyandMainStreet.  Right after that there are a series of people who I assume are Bank of America employees talking about the mortgages they help people get.

Bank of America’s Spin

What caught my attention was that Bank of America was putting a spin on the truth.  By showing the clip of the priest and the work he was doing they are implying that they are doing all they can to help their customers who are facing foreclosure save their homes.  By tying in how their employees help people get the correct mortgage for their situation they are implying that they are totally ethical in the way they loan money and that they have not put any people in mortgages they could not afford. 

I am sure that all of their employees have not always been so ethical.  Some of Bank of America’s employees have had to place customers in mortgages they could not afford.  They had to know this while they were working with them.  There is no way this could not have happened.

More upsetting to me is the inference that Bank of America is doing all they can to help people who are facing foreclosure on mortgages they have with them save their homes.  If you have been reading the posts on my blog, you have seen my most recent post on Bank of America’s performance in the Making Home Affordable Modification Program.  They have only offered 7.2% of the estimated 796,487 people eligible loan modifications under the program.  Does it look like Bank of America really cares about helping people save their homes?  I am sure you would agree that

The Answer Is a Big No

If you have a mortgage through Bank of America and are facing foreclosure, please don’t expect them to go out of the way to help you save your home.  Thus far their track record shows the opposite.  Be prepared to have problems trying to work with them.  Don’t try to deal with them yourself.  Hire a lawyer or an expert in loan modifications to represent you.  You need expert help when dealing with them. 

I also suggest that you learn as much about the process and the steps you can take to save your home and protect your family.  Late last year I wrote an EBook on the subject.  You may want to check that out.  You can find out more about it by clicking Stop Foreclosure.

Much Success,

Mark Elkins

The Problem

Many people who have fallen behind on their mortgages and are in the midst of the foreclosure process are unreachable.  They do not respond to contact from their mortgage companies.

One Solution 

Hire an outside company to make the contact for you.

I just read an interesting article about one such company.  Mortgage companies hire them as their representatives.  The name of the company is Titanium Solutions.  Let me tell you a little bit about them.

They bill themselves as an intermediary between mortgage companies and people facing foreclosure.  Their goal is to help these people start to communicate with their mortgage company so that together they can find away to save their home from foreclosure.

They are hired by mortgage companies to contact people who have fallen behind on their mortgage payments.  Initially they will try to call them from a contact center in South Carolina.  Cases where phone contact is unsuccessful are referred out for personal contact.

This is Where It Gets Interesting

The representatives hired by Titanium Solutions are local realtors.  Most have 3 to 5 years of experience in the real estate industry.  Their job is to knock on the doors and make contact with the people.  They talk to them about the loan modification process.  They explain what documents and forms they need to submit as part of their application for a modification.  Sometimes they will even go back, pick up the completed documents and send them to the mortgage company.

Why Realtors?

Realtors are familiar with their community.  They don’t like to see homes foreclosed because property values drop in the area and that hurts all sales.  They can also build rapport with homeowners they do not know.

What’s So Great About This Approach?

It gets people who thought their situation was hopeless and would not do anything to try to save their homes to realize that they may be able to do something.  They can talk with their mortgage company and they may be able to turn their situation around and save their home.

What Are The Drawbacks?

First – the role of the representatives from Titanium Solutions ends after they get the person who is behind on their payments to talk to their mortgage company.  They normally have no contact with them afterwards.  If the representatives at the mortgage company are unresponsive later on, the person facing foreclosure has to try to handle it themselves.

Second – sometimes the mortgage company does not let the person facing foreclosure know that a representative from Titanium Solutions will be contacting them.  When the representative comes by unexpectedly, the homeowner is taken off guard and is skeptical.  They wonder who this person is.  Initially there is a lack of trust.  Are they who they say they are?  Are they really there to help them?

Third – The person facing foreclosure fears that the main reason they are there is the mortgage company has hired them to sell their homes.  Some representatives from Titanium Solutions have added to this fear by taking pictures of homes prior to making contact with those they were asked to contact..

Why Did I Find This Interesting?

First – Mortgage companies have done a horrible job of trying to contact people facing foreclosure.  I like that some have looked for other ways to initiate contact.

Second – It’s great to see that the mortgage companies are outsourcing this contact to other firms.  Since these firms have no connections with the mortgage companies they can act as intermediaries between the companies and people facing foreclosure.

Third – It is great to see that realtors are being hired as representatives of Titanium Solutions.   They know their communities and truly care about it.

Some Final Thoughts

If you are contacted by a representative from Titanium Solutions, remember they are acting as a go between between your mortgage company and you.  They are not your representative.  They are only there to get the loan modification process started.  Their role is very limited.

Even though they contact you and you may be able to start to talk with someone at your mortgage company, it is still best to get a lawyer or an expert in the field to help you get the modification best for you.  The lawyer or expert will always have your best interests at heart.

For more ideas on how to save your home from foreclosure, please check out my EBook.  You can find out more about it by clicking stop foreclosure answer.

Much Success,

Mark Elkins

Most probably you have never heard of the Kondaur Capital Corp.  I know I never did until I read an article about them recently.  This is a company based in California.  They buy non-performing mortgages from other companies.  Non-performing mortgages are those where the people are no longer making their monthly payment on time and their mortgage company has started to foreclose.

What is different about Kondaur Capital?  They are in business to make money.  They only want to buy those mortgages where it is likely that the people can resume making a regular monthly payment on time or where they can help the person understand that they just cannot afford their home and they would be better off to sell it.

The challenge with most mortgage companies today is that they still do not know how to analyze a person’s financial situation to determine if a loan modification will enable them to save their home from foreclosure.  In the past most mortgage companies just looked at how much the person was behind on their monthly payments and what late fees and additional interest has accumulated.  They added these up and figured out how much they had to increase the person’s monthly payment over a specified period of time so that the shortage could be recovered.  After the shortage was recovered the monthly payment would drop back to what it had been.  Some companies still operate this way.  Most have switched.  Now they look what the person’s gross monthly income is.  They figure out what the monthly payment would have to be if it were 31 to 35% of that monthly income.  They agree to reduce the monthly payment to that amount for a certain specified period of time.

How does Kondaur Capital differ?  They do an extensive review before they buy a mortgage.  They get a current estimate of the value of the property.  They then look at the balance of the mortgage and the monthly payment.  They also take into account the person’s income.  Then they go further.  They look at the person’s other bills to see how much they have to pay monthly.  Next they look at their track record to see how the person has made their monthly payments in the past.  Have they normally paid their bills on time? 

This review gives them a good idea of whether or not they can help the person?  It also helps them determine their chances of making money if they buy the mortgage.  If they decide that this mortgage fits their model, they offer to buy it from the current mortgage company for a specified price.

If the mortgage company sells the mortgage to them, they then contact the person and discuss the mortgage with them.  They may offer to modify the mortgage and reduce their monthly payment.  At times when they do this, they also agree to lower the amount of the mortgage to a more realistic amount based on what the current value of the home is.  In certain instances the person may be in over their heads.  There is no way that the payment can be reduced to a level they person can afford to make consistently on a monthly basis.  In these situations Kondaur Capital educates them on this and they help them prepare to sell the home.  Kondaur Capital does not want to take money from the person now if within a short period of time the person finds out that they can no longer continue to make the payment and is forced to sell their home.

As you can see, Kondaur Capital works with each person whose mortgage they buy.  They endeavor to come up with a solution which is satisfactory for both parties.  They also make sure to treat each person with dignity.

If Kondaur Capital has purchased your mortgage, does that mean that you should rely solely on what they tell you?  By no means.  I still recommend that you get outside representation.  Why?  Simply because you want someone representing you who has your best interests at heart.

I also recommend that you find out as much as you can about the steps you can take to save your home from foreclosure.  You might want to check out the information in my EBook.  You can find out more about it by clicking Stop Foreclosure.

Much Success,

Mark Elkins