Home Loan Modification Will Help Stop Foreclosure
Posted on | May 26, 2009 | 29 Comments
Wikipedia defines foreclosure as
the legal and professional proceeding in which a mortgagee, or other lienholder, usually a lender, obtains a court ordered termination of a mortgagor’s equitable right of redemption. Usually a lender obtains a security interest from a borrower who mortgages or pledges an asset like a house to secure the loan. If the borrower defaults and the lender tries to repossess the property, courts of equity can grant the borrower the equitable right of redemption if the borrower repays the debt. While this equitable right exists, the lender cannot be sure that it can successfully repossess the property, thus the lender seeks to foreclose the equitable right of redemption. Other lienholders can also foreclose the owner’s right of redemption for other debts, such as for overdue taxes, unpaid contractors’ bills or overdue HOA dues or assessments.
Unfortunately, the current housing crisis has greatly increased the number of foreclosures in many of the bubble states. California, Nevada, Las Vegas and Florida have all seen steady increases in the amount of foreclosures. When an individual or family cannot find a way to make their mortgage payment for several months, foreclosure is almost inevitable. I think we all have friends and family who have been through this troubling time and it is not a pretty sight.
Is there anything you can do to stop foreclosure? There are numerous resources on the internet to help stop foreclosure. Ultimately, the best thing anyone can do is educate themselves on what their options are. I have several close friends who would rather pay off credit card debt than make their mortgage payment. This is a VERY bad idea. If you default on your mortgage payment, it is going to be extremely hard to ever build your credit to a respectable level. If you cannot pay a credit card, your credit score will get hit but not nearly as much as with a foreclosure.
Therefore, your number one financial priority should be to make your mortgage payment each and every month. What if I don’t make enough money to make my mortgage payment? This is all to often the case with the amount of salary reductions and layoffs during the current recession. If you do not make enough money to pay for your mortgage you can look into the Making Home Affordable Plan and see what the government can do to help you out.
No matter what you may think, the government wants to keep you in your home. The more homes that are foreclosed on the worse the economy is going to get. That is the exact reason that President Obama created the Making Home Affordable plan. He wants you to stay in your home, make your mortgage payments and live happily ever after. With that being said, you must find a way to budget your money to make your mortgage payments.
The Making Home Affordable Plan mandates that your mortgage is only 31% of your monthly salary. This is the case if your mortgage loan is backed by Fannie Mae or Freddie Mac. Almost 70% of home loans in America are backed by these two companies. If only 31% of your monthly salary is going towards your home loan then you should definitely have enough money to pay for it. One of the hardest things you may have to do is to sit down and write out all the money you actually spend. I mean write down every single penny you spend for a month’s period. If you buy a $1.49 pack of chewing gum before work every Monday, you need to write it down. You do not realize how bad you get nickel and dimed until you actually write down every single purchase.
After you have figured out how much money you spend in a month, you are likely going to need to cut out some habits. Do you really need to buy three drinks every time you go out to eat. For that matter, do you need to go out to eat as much as you do? Is it mandatory that you get your nails done at the most luxurious spa? These are questions you need to ask yourself and be honest. There is a fine line between being happy and being wasteful. If something makes you extremely happy and you can afford it, by all means continue to do it. If you cannot pay for your mortgage, you might want to reconsider some of the things you feel makes you happy.
Another way to get through this troubling time is a home loan modification. This has been extremely important with stopping foreclosures. If you can find a way to get a lower mortgage rate then you are going to pay much less in a monthly mortgage payment. With this, you will also pay much less over the entire lifetime of your home loan. If you can save just $50 a month, that could lead a long way to stopping foreclosure on your home.
Getting a home loan modification is also all about educating yourself on what your options are. There are an unlimited amount of resources available on the internet to research home loan modification or mortgage refinance. Make sure to get information from relevant sites as there are a great deal of spam sites out there. If you need any help, just do a quick google search for mortgage refinance or stop foreclosure and I am sure you will get some great resources.
Ultimately home loan modification will help stop foreclosure. This is exactly what the President wanted and he will make sure it happens. Hopefully the number of foreclosures greatly declines through the next several months as this has been a hinder on the recovery of the economy. Having lower mortgage payments and more money to stimulate the economy will help us on the road to recovery. For more information on home loan modification and stopping foreclosure, make sure to come back to Subprime Blogger for future articles.
- Mortgage Rate Predictions – Rates Lower to Historic Levels?
- Economic Crisis – Recession with Rising Interest Rates and Rising Inflation
- Home Loan Modification Programs Will Help You Save Money
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29 Responses to “Home Loan Modification Will Help Stop Foreclosure”
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May 26th, 2009 @ 9:11 am
[...] news by admin « Grab A Fixed Rate Mortgage While Rates Are Low | Home Based Business Mortgage [...]
May 26th, 2009 @ 11:06 am
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May 26th, 2009 @ 1:27 pm
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May 26th, 2009 @ 1:45 pm
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May 30th, 2009 @ 1:44 am
Subprime Blogger / Home Loan Modification Will Help Stop Foreclosure…
Unfortunately, the current housing crisis has greatly increased the number of foreclosures in many of the bubble states. California, Nevada, Las Vegas and Florida have all seen steady increases in the amount of foreclosures. When an individual or fam…
June 5th, 2009 @ 12:46 pm
I was in the home loan business and a lot of the questions I get regarding loan modification – are whether or not someone qualifies.
Just like the mortgage boom, people that really should not have qualified for mortgages did, and now with loan mods, people that really are not in distress, but don;t want to pay their mortgage are getting mods.
Here is an interesting article about who does and does not qualify for a mod:
http://www.bankapedia.com/mortgage-encyclopedia/faqs/340-am-i-eligible-for-a-loan-modification
June 9th, 2009 @ 8:54 am
[...] of the questions that many people are considering right now is this one: Can home loan modification really help to stop foreclosure? The answer, as so often is the case with such personal finance [...]
June 9th, 2009 @ 9:07 pm
Nice to know that President Obama created a Making Home Affordable plan, as we all know, foreclosures homes are increasing everyday. The home loan modification is indeed a big help to stop foreclosures. Hope that the government will create plenty of plans or programs like these.
June 11th, 2009 @ 6:58 am
[...] the author: Subprime Blogger offers information on getting a home loan modification. There is also information on picking the best inflation [...]
June 11th, 2009 @ 9:55 pm
Yes thanks to President Obama for these new government project. Who else can afford to lose home. No one wants it to happen. I agree about the home loan modification. This will lessen your burden in paying your monthly bills and thus will prevent foreclosure. But before doing this things, you must be careful and avoid getting scam by companies that try to trick you with promises. I suggest to get guides online for the right decision you will make about home loan modification.
I have seen one of the site that offers this guide and able to help one family from their problem.
http://helpstopforeclosurequick.com/
They also offer free guide for hardship letters which is needed for the home loan modification.
http://hardshiplettersample.com/
Hope this will help you guys.
“STOP FORECLOSURE”
June 12th, 2009 @ 4:05 pm
[...] Home loan modification has been extremely popular over the last several months as mortgage rates dropped to well under 5%. Many home owners were modifying to save money on mortgage rates while others were doing what they could to stay in their homes. President Obama vowed to stop foreclosure and help families stay in their current homes and that is what he did for the first six months of the year; by keeping mortgage rates low. [...]
June 12th, 2009 @ 5:01 pm
[...] Home loan modification was a buzz word for quite some time in early 2009. Everyone and their brother, or sister for that matter, wanted to modify their mortgage. Some people were modifying to avoid foreclosure while others were refinancing at extremely low rates to save large sums of money. Either way, the historically low mortgage rates made it very alluring to get a mortgage modification. [...]
June 13th, 2009 @ 7:39 am
[...] Please make sure to keep up with daily mortgage rates through Subprime Blogger. There are also several useful articles on home loan modification. [...]
June 15th, 2009 @ 2:12 am
[...] Home loan modification is something that many home owners have resorted to to avoid foreclosure, especially after the subprime mortgage crisis. With mortgage rates at low levels, getting a home loan modification could very well keep you in your home. The only problem with the current mortgage market is that rates are headed higher and if you are seeking a home loan modification, there is a chance that you will not get the low mortgage rate that you desire. [...]
June 16th, 2009 @ 12:10 am
Thanks for sharing this info blog with us.
June 22nd, 2009 @ 11:11 pm
It seems that reducing some extra costs won’t stop home foreclosure. But I do agree with you that if thoroughly consider and count all your monthly expenses and cross out the ones that are not primary for living then it’ll quite help. If at risk of ending without a roof it’s better to do some aesthetic sacrifice.
June 27th, 2009 @ 7:31 am
[...] Blogger offers information on getting a home loan modification. There is also information on picking the best inflation [...]
June 27th, 2009 @ 7:35 am
[...] Blogger offers information on getting a home loan modification. There is also information on picking the best inflation [...]
July 1st, 2009 @ 9:39 pm
According to the Department of Treasury: “Anyone with high combined mortgage debt compared to income or who is “underwater” (with a combined mortgage balance higher than the current market value of his house) may be eligible for a loan modification. This initiative will also include borrowers who show other indications of being at risk of default. Eligibility for the program will sunset at the end of three years.”
As reported in the LA Times, “This program applies to borrowers who are unable to make – or are struggling to make – mortgage payments that exceed 38% of their monthly income. If the lender agrees to lower the interest rate or reduce the principal amount to bring the payment to 38% of the borrower’s income, the government will pay half of the additional cost to the lender to reduce the payment to 31% of the borrower’s income.”
July 2nd, 2009 @ 7:46 am
Forensic Loan Audit
Forensic Loan Audit
Loan Audits
Truth-In-Lending Act (TILA) Violations — Inaccurate reporting of APR and finance charge calculations on borrower disclosures. Calculation errors may occur as a result of failing to include one or more prepaid finance charges in the calculations, incorrect disclosed funding dates, or last-minute changes made to the loan by the settlement agent at the closing table. If understated, the lender is in violation of the federal Truth-In-Lending Act as well as many state laws prohibiting such actions. Lender required to reimburse borrower for the difference, and may be subject to statutory damages, administrative sanctions, loan buy-backs, and lawsuits. In addition, the rescission period may reopen, creating additional risk for the lender.
Anti-Predatory Lending Violations — Consumer protection laws, regulations and guidelines exist at the federal, state and local levels, and function by placing strict but varying limits on the rates and fees that can be charged to a borrower. Violations typically occur because of the vast misunderstanding of how they work. Examples of violations include failing to include fees such as yield spread premiums in the calculations or using an incorrect loan amount value to perform the calculation. Penalties for violations are as varied as the laws that govern. Typical costs include borrower reimbursements, statutory and punitive damages, attorneys’ fees, administrative fines and penalties, loan buy-backs and reformation, and class-action lawsuits.
State Law Violations (Non-Predatory) — Failing to maintain adequate safeguards in loan origination systems and well as document software systems results in loans containing illegal terms or provisions. Examples include illegal prepayment penalty clauses, rates that are usurious, or fees that are not allowed to be charged. Typical penalties include actual damages and costs, attorney’s fees, administrative fines and penalties, loan buy-backs, and class-action lawsuits.
Reverse Mortgage Violations — With an expected 55 million Americans turning 62 in the coming years, the “next big thing” will almost certainly be reverse mortgages. Common violations include failing to adequately disclose the APR, which is different than that of forward mortgages, and providing incomplete or improper disclosures. Because this is such a new segment in the industry, penalties are less clear than with forward mortgages. As these types of mortgages affect senior citizens, class-action lawsuits are a real and serious threat.
Real Estate Settlement Procedures Act(RESPA) Violations — RESPA prohibitions place limits on a lender’s or broker’s ability to charge or pay fees that are hidden from the borrower. Common violations include accepting kickbacks or referral fees, upcharging for services provided by third parties, and charging for services not actually performed. Penalties include actual damages, administrative fines and class-action lawsuits.
Others: Lending without providing borrowers a reasonable, tangible net benefit, state-specific disclosure errors, servicing violations, Fair Lending violations.
I know of a company that is experts at Forensic Loan Audit’s. With legal counsel to support their clients they perform a 200 point loan audit to identify predatory lending and mistakes made during the loan process.”
They offer a Free Consultation and a money back guarantee for these services.
July 8th, 2009 @ 9:55 pm
[...] thought I would throw up a good article I found on home loan modification. I know it is a struggle out there for many right now just to stay in their homes. The best [...]
July 8th, 2009 @ 9:58 pm
[...] seems to be getting much worse, I would imagine we are going to see a lot more people try to get a home loan modification. The one bit of advice I would give is to do as much research as you can and if you do not [...]
July 9th, 2009 @ 4:23 pm
[...] Blogger to get your mortgage rates forecast. There are also several articles to help you get the home loan modification you may [...]
July 10th, 2009 @ 3:21 pm
[...] through the home loan modification process is something no one wants to do. Even if you don’t want to go through this, it may [...]
July 12th, 2009 @ 12:01 pm
[...] get your information on low mortgage rates. We also offer several articles to help you with the home loan modification [...]
July 17th, 2009 @ 11:17 pm
[...] Please use Subprime Blogger to get your mortgage rate predictions and mortgage rate trends. We also offer several articles on home loan modification. [...]
July 21st, 2009 @ 7:53 pm
[...] Please use Subprime Blogger to get your mortgage rate trends; all trends articles are updated Monday, Wednesday and Friday. There are also several articles to help you get a home loan modification. [...]
July 28th, 2009 @ 11:29 pm
[...] Please use Subprime Blogger to get your mortgage rate trends; all trends articles are updated Monday, Wednesday and Friday. There are also several articles to help you get a home loan modification. [...]
August 7th, 2009 @ 7:48 pm
[...] Please use Subprime Blogger to get your mortgage rate trends; all trends articles are updated Monday, Wednesday and Friday. There are also several articles to help you get a home loan modification. [...]