Alright Chicago, it is time we had a little heart to heart with the problems in your life when it comes to not having a job and possibly loosing your home.
Chicago Bank foreclosures are on the rise. Whether you know it or not, it is not "cool" to let your home go into foreclosure. Don't know any other way to put it but right straight out in front of your face.
You think I am joking about this but I just saw that Bank of America will be increasing their foreclosure count big time by December 2010. This isn't something where we have time to get depressed. In fact, I am asking you to take the "bull by the horns" and stop allowing yourselves to believe that you are a looser, that you are the only one in the boat, the the ship has left the harbor! I need you to get a grip. Everybody is trying to be nice out there, but the fact remains, you need to jump on this right away, hopefully, prior to you loosing your home.
Let's just take a look at the options:
Your hours are cut back and you can't make your monthly mortgage payment to the bank. Get a hold of the bank right away and let them know that your hours are cut back. Make sure that you have two recent pay stubs that shows that your hours are cut back from the previous years income. What they may suggest is to put you on a tiral loan modification while you gather your paperwork for the bank to review. Write a letter of explanation explaining your hardship (divorce, medical, job loss, etc.) along with the two years previous tax returns, Two months bank statements, if you are self-employed, last years profit and loss, and the first three months P&L's for this year, along with checking, savings, 401(k), etc.
Come on people - you are bleeding from lack of money. You'd be going to the doctor if this were blood! Bottom is, it affects you.
Where you aware that if you allow your home to go into foreclosure that you are paying taxes on the deficiency of the loan amount from the selling price, plus the legal fees, penalties and interests get thrown in as well to that deficiency.
Did you know that if you tried a loan modification and were rejected, that you can reapply again? Do you know why you were rejected? They won't tell you, but I will. Your file is missing information, or was incomplete, in other words.
Get the loan modification started. You don't pay for it and any agency that charges or attempts to charge you for this is a swindler who doesn't know anything but how to get money from you and then say "sorry, Charlie". That isn't how it works. Believe it or not, there are laws that protect you!!
Now, if you look at the fact that your situation isn't short term but long term, then you need to consider a short sale. A short sale is where the bank allows you to sell the property for less money then what you owe and under the Forgiveness Act, you are forgiven but that doesn't mean you are forgiven on the note. Big difference there!
- When you do a short sale, the bank needs to approve you for the short sale as they see that you are inside out and upside down. That being: you owe more then your home is worth and your situation is long term and no end in sight. Doesn't have to do with your credit card indebtedness but that your hardship situation is the issue (illness, death, divorce, job loss, transfer, etc).
- During this time one of the things I push for with my clients is that we get a modification for a lower payment during this time so that the bank doesn't file a lis pendens against you. That way, it buys you time and stops the clock from ticking until you get that contract, that has to be submitted to the bank, well their loss service provider who oversees the file.
- If you have already received a lis pendens, then we want to make sure that the bank has all your financing information and we send them the listing agreement, etc.
- When you sell your property as a short sale, the bank pays for the closing costs and you walk away with nothing from the table but forgiveness.
If you allow your property to go into foreclosure you are up to your neck in paying income taxes on the deficiency as well as if you have a 2nd or 3rd lien, those notes will be sold to a collection agency who will be on you down the road for getting monies from you for those outstanding liens.
I am writing this post today because I have seen people try to attempt a short sale with someone who doesn't have the experience or because you are in denial and you just want to hide and run for the entire situation and you want to forget about it. It isn't forgotten people. Bottom is, from what I can figure, about one in 6 people are in the same boat as you. You actually are the norm. Not a good thing to have or be but the bottom is, stop punishing yourself!! You can't change the economy and there are alot of people out there that don't have jobs. I have actually seen an attorney deliver pizza in the evenings to keep food on the table and the bills paid. People are doing what they need to do, within the law, to stay afloat.
You have options and you need to start standing up for yourself and saying "enough is enough". Make the change in your life and do something for yourself and your family. Stop the bank from taking your home.
Just my two cents on this Friday night. I hope this opens the heart and eyes of a few of you. m
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