HOME OWNERS, BUYERS, INVESTORS...this BLOG's FOR YOU

Foreclosure information and assistance to guide you through the "foreclosure process," the "foreclosure market" and what to do "after you've been foreclosed on." If you need assistance with anything to do with a "foreclosure" remember foreclosure is a process that needs to be thoroughly understood to be protected no matter if you are buying, selling or trying to avoid it. I am a licensed Realtor who has that knowledge and training you need.

PART I      Information for people who may find themselves facing forecloure.

PART II     Information for people wanting to learn the process of purchasing a property in foreclosure

                or a bank owned property.

PART III   Services for people ready to preview and purchase a pre-foreclosure property

                or a bank owned property.

PART IV     Credit worthiness and how to repair your credit.

PART I     

     HOW TO STOP FORECLOSURE:

Top 10 Tips For Homeowners Who Are Facing Foreclosure, if you are unable to make your mortgage payment:

 1. Don't ignore the problem.

The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house.

2. Contact your lender as soon as you realize that you have a problem.

Lenders do not want your house. They have options to help borrowers through difficult financial times.

3. Open and respond to all mail from your lender.

The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notice of pending legal action. Your failure to open the mail will not be an excuse in foreclosure court.

4. Know your mortgage rights.

Find your loan documents and read them so you know what your lender may do if you can't make your payments. Learn about the foreclosure laws and timeframes in your state (as every state is different) by contacting the State Government Housing Office.

5. Understand foreclosure prevention options.

Valuable information about foreclosure prevention (also called loss mitigation) options can be found on the internet at www.fha.gov.

6. Contact a non-profit housing counselor.

The U.S. Department of Housing and Urban Development funds free or very low cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender if you need this assistance.

7. Prioritize your spending.

After healthcare, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment. Look for optional expenses-cable TV, memberships, entertainment-that you can eliminate. Delay payments on credit cards and other "unsecured" debt until you have paid your mortgage.

8. Use your assets.

Do you have assets-a second car, jewelry, a whole life insurance policy-that you can sell for cash to help reinstate your loan? Can anyone in your household get an extra job to bring in additional income? Even if these efforts don't significantly increase your available cash or your income, they demonstrate to your lender that you are willing to make sacrifices to keep your home.

9. Avoid foreclosure prevention companies.

Many for-profit companies will contact you promising to negotiate a loan work out with your lender. While these may be legitimate businesses, they will charge you a hefty fee (often two or three month's mortgage payment) for information and services your lender or a HUD approved housing counselor will provide for free if you contact them. You don't need to pay fees for foreclosure prevention help-use that money to pay the mortgage instead.

10. Don't lose your house to foreclosure recovery scams!

If any firm claims they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf, you may well be signing over the title to your property and becoming a renter in your own home! Never sign a legal document without reading and understanding all the terms and getting professional advice from an attorney, a HUD approved housing counselor or trusted real estate professional.

Avoiding Foreclosure - The Critical 1st Step:


The most important first step you must take when you fall behind on your mortgage payments is to contact your lender immediately.  DO NOT IGNORE the letters and phone calls from your lender.  If you're having trouble making your payments don't wait for them to call you - call them.  I mean right NOW!  Time is crucial.  This is the most common mistake homeowners make when they get behind on their payments.  Do not pretend that your situation is not serious or that your problems will quickly correct themselves.

Many people avoid calling their lenders when they have money troubles.  In fact, studies suggest that 40 to 50% of all the people who go into foreclosure never have any contact with their lender after the first missed payment.  This is a mistake.  Most of us are embarrassed to discuss our money problems with others or believe that if lenders know we are in trouble, they will rush to collection or foreclosure.  This is false.

Contrary to what you may believe lenders want to help borrowers keep their homes.  Why?  Because foreclosure is an expensive process for lenders, mortgage insurers, and investors.  Fact is most lenders that actually do foreclose end up losing money on the deal.  Because of that fact lenders tend to work aggressively with borrowers who are facing money problems.  That is an important point to understand - that they do not want your home.  They only want your monthly loan payments and the interest that comes with it.

Don't lose valuable time by being overly optimistic.  Contact your mortgage lender to discuss your circumstances as soon as you realize that you are unable to make your payments.  While there is no guarantee that any particular relief will be given, most lenders are willing to explore every possible option with you.

Lenders have several workout options to help you stop home foreclosure and stay put.  They go by many names* - forbearance, mortgage modification, partial claim, and payment suspension to name a few.  However, these options work best when your loan is only one or two payments behind.  The farther behind you are on your payments, the fewer options are available.  Contact them as soon as possible to discuss possible solutions.

How to Find Your Lender
 
Check the following sources for lender contact info: 

· Your monthly mortgage billing statement 

· Your payment coupon book

· Web links or customer service phone numbers found on the internet

Information You Should Have Ready When You Call

To help you, lenders typically need: 

· Your loan account number found on your statement or coupon book  

· A brief explanation of your circumstances.  Be honest with them   

· A list of your household expenses  

· You may be asked to provide recent income documents

When you call your lender ask to speak with a manager instead of the front-line operator who is only looking to collect your back payments.  Grab a pad of paper and jot down the time and day of your call, the name of the person you spoke to, and what was discussed.  Don't forget to ask for a direct-line phone number of the person you spoke to so you can re-contact that individual without having to go through the annoying automated phone menu.

Understand that foreclosure is a legal process and you have rights as a homeowner.  It is important to learn how much time you have to work with before losing ownership of your home.  You can find the foreclosure timeline for the state you live in at: www.foreclosurelaw.org   

Expect to have more than one phone conversation with your lender.  Typically, your lender will mail you a "loan workout" package.  This package contains information, forms and instructions.  If you want to be considered for assistance, you must complete the forms and return them to your lender quickly.  The completed package will be reviewed before the lender talks about a solution with you.  Make sure you follow through on this since it will buy you more time.


The bottom line here is to call your lender today.  Remember - you don't want to lose your home and they don't want to take it.  * For a free glossary of mortgage terms go to: www.hud.gov/offices/hsg/sfh/buying/glossary.cfm  This resource will enable you to understand some of the terminology you lender will use when speaking with you.


What If I Can't Make My Loan Payment or I'm Already Behind on My Payments?
 

YOU HAVE MANY OPTIONS TO STOP OR AVOID THE FORECLOSURE PROCESS

The key is to take action quickly.  If you are facing FORECLOSURE...KNOW  YOUR  RIGHTS!  If you live in Minnesota or Wisconsin  I would like to help you.  I specialize in representing people who are one or more payments behind on their mortgage. I am experienced and trained in assisting people who are facing foreclosure. Let me work with the bank for you.  Call me today for your private, FREE consultation.  Don't wait, the sooner you contact me the more options I have to help you.

Do one or more of these apply to you?

• Are you one or more payments behind on your mortgage?
• Is your interest rate about to adjust?
• Are you trying to stop foreclosure?
• Do you have 1, 2 or even 3 mortgages on your property?
• Are you worried about having a foreclosure on your credit report for the next 10 years?
• Do you have equity in your home you can't get at?
• Do you need help FAST?

If you answered yes to any of these, I would like to help you. You have options....YOU DON'T HAVE TO FACE FORECLOSURE ALONE! 

As hard as it is to believe, your lender does NOT want your property. THEY JUST WANT TO GET PAID.    

Call or email me today for a no risk free consultation, understand your options, Renee Johnson, EXIT Realty Executives 612.636.2807 rjohnson@exitrealtyexecutives.com

PART II

   FORECLOSURE GUIDE FOR BUYERS

So you're looking for a bargain? It won't be easy. Buying a foreclosure is tricky and can be time consuming, but if you do your homework and follow the 10 steps outlined in this Foreclosure Guide For Buyers, you can land a great deal on a home.

PART III

YOU'VE DONE YOUR HOMEWORK & YOU'RE READY TO BUY!

I will be happy to customize a free list of pre-foreclosure, short sale and bank owned properties in your market area.

What are you looking for, send me an email.....    rjohnson@exitrealtyexecutives.com

Please be as specific as possible in your email on what you are looking for; your market area, this can be by city, zip code, neighborhood, school district, etc. style of home or property you desire, number of bedrooms, number of bathrooms, and anything else that is important to your wants and needs. I will customize a free report for you based on the information you provide.

Many opportunities are available in todays market; move-in condition, cosmetic repairs such as paint and carpet, handyman specials needing a little more work than just paint and carpet, new construction. One thing is for sure, these are really good deals!

There are still financing options available for almost every type of property and their condition. Don't have alot of cash to make repairs? FHA 203k is a low interest, 30 year fixed loan that will allow you to finance up to $35,000 worth of repairs...it's that simple and easy. First time home buyers, there are still down payment assistance programs available offering 100% financing. It couldn't be a better time to buy a home!

PART IV     CREDIT WORTHINESS

• 35% of your credit score is based on payment history, paying your bills on time.
• An additional 30% is based on revolving balances carried on accounts as they relate to debt utilization ratios, credit limit vs. amount currently owing on the account.
• In addition to your revolving accounts 15% of your credit score is based on how long you have actually had the account. The scoring on these accounts have reached there maximum scoring potential at the 15-year mark.
• Another 10% of your credit score comes from what type of loans are reported on your credit report, i.e. one mortgage, one care loan, number of credit cards.
• How many times you apply for credit will impact your overall credit score by 10%. Credit scores are pulled for home loans, auto loans and other installment loans. Credit scores are now being pulled for homeowners and auto insurance rates, apartment rentals, and employment purposes. 
• Your credit score can further be impacted by parking tickets and overdue library books. High credit scores can save the consumer hundreds and thousand of dollars in interest over the life of the loan.  More to come on repairing your credit.