Tehama Country Real Estate

Tehama Country Real Estate – 3 With These Strategies FORECLOSURE Avoid Foreclosur e FACING spread layoffs are causing many people to fall behind on their bills, including mortgage payments. That means many homeowners are facing foreclosure. But there are options to avoid it. Statistics show that there are still a high number of homes that are going into foreclosure, despite early real estate stimulus efforts. The Mortgage Bankers Association predicts that 1 out of every 200 homes in the U.S. will be foreclosed on, and every three months another 250,000 new families enter into foreclo- sure. A slower real estate market has trans- lated into falling home prices for many people. For those who opted for adjustable rate mortgages, higher adjust- ments mean the inability to pay out- standing loans. Furthermore, low home values could mean that many people owe more on their home mortgages than the properties are currently worth. Despite public perception, lenders do not want to foreclose on a house unless absolutely necessary. Lenders can lose 20 cents to 60 cents on the dollar for a fore- closure. The average lender loses $50,000 or more on a foreclosure due to legal fees and other expenses. This means that D Diminishing jobs and wide- banks may be willing to negotiate with homeowners who are facing foreclosure. Alender will generally contact a person within 90 days if payments on the mort- gage are missed and will file a "notice of default." However, even with one missed payment, the credit bureaus generally get wind of late or unmade payments, which can greatly affect a person's credit rating. Acting before payments are late can save a homeowner's reputation. * Contact the bank to talk about inabili- ty to pay. Homeowners will want to speak with the "loss mitigation" depart- ment. There they can talk about payment plans and schedules that may be able to stretch out or reduce payments, called loan modification. * If there is enough equity in the home, a homeowner may be able to refinance the home at a better rate. Don't wait until the last minute to do this. Credit ratings are likely to be a factor when determin- ing the interest rate. Steer clear of other risky loans, such as interest-only or another adjustable rate, if possible. * Try selling the home in a convention- al manner. Too many times people are attached to their homes. In essence, the home is a piece of property. Holding on to it when it cannot be afforded can spell trouble. Sell while there is still equity and find a new place to live that's more affordable. * Consider a short sale if what is owed on the house is considerably more than what the house is worth. The loss mitigation depart- ment is also in charge of approv- ing a short sale on the home. The lender will agree to accept a lower price on the home than what the homeowner currently owes on the mortgage note. * Offer the lender a deed in lieu of foreclosure. If efforts have been made to sell the house without results, a homeowner can propose handing over the deed to the home and the lender agrees to release him or her from the mortgage. Lenders may only agree to this if an unavoidable hardship was the reason a person is facing foreclo- sure.

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