Obama’s administration geared up to try to prevent as many as 4 million homeowners from going into foreclosure status by having mortgages lowered and government financial assistance in place. They have started with 650000 trail loan modifications in their attempt to reach the 4 million goal. The problem doesn’t lie with the “want” to save homeowners from foreclosure, the problem rather lies with the history of mortgage modifications. The thought and purpose behind mortgage modifications is a good one, however it doesn’t mean that just because one has been successfully implemented that the homeowner will not default on that as well. This type of fix may only be a delay of foreclosures that would have happened anyhow. This doesn’t by any means imply that every homeowner that gets a loan modification on their mortgage will later default, it is just not a 100% cure for the current foreclosure crisis and should not be looked at in that manner.
Due to the countrywide effort to slow down foreclosures, many states have also implemented their own rescue efforts. With Sate budgets already stretched to the max and the risks of homeowners still defaulting on their mortgages even after receiving help, it is like throwing good money away for nothing while putting the State funds in jeopardy.

If you look at the current delinquent rates, which are hitting at 4.45% for single-family home loans in August and growing, without any changes in the homeowner’s financial situations, rescue attempts seem fruitless. Unless you were to settle the mortgage out in full, there still lies the risk of default. The financial burden that government would take on of settling out default homeowners mortgages is not a realistic solution for hundreds of reasons

If the unemployment rates do not change, regardless of the aid given to faulting homeowners there is no guarantee that they will even maintain new monthly mortgage debts after a loan modification. This is the hole in Obama’s plan to help failing homeowners in saving their homes from foreclosure. If the overall credit history of the homeowner at risk is good, meaning before they lost their job, or whatever brought them to their current default status they were maintaining a good standing, then with help, that population may very well be able to maintain their home by a loan modification. However, for those who had a shaky or poor credit history to start with, by providing them with a loan modification is risky and more than likely will just delay the inevitable. Short sales would be a better option for them and cause less damage to their already suffering credit history than foreclosure of bankruptcy.

Some banks have delayed putting mortgages into foreclosure status so they would fall under and possibly qualify for the federal foreclosure prevention program, but even with the stall, repossession rates continue to climb. The second week of October the Making Home Affordable signed up 500,000 borrowers, a milestone for the program showing that the rocky start is now starting to make some progress, but not near enough quite yet. There still is a couple issues with the governments Troubled Assets Relief Program that if rectified would help foreclosure numbers decrease in that it does not address two of the main reasons foreclosure numbers are so high – rising unemployment rates, and option adjustable- rate mortgages.

States that are currently being hit hard by foreclosure are Arizona and Nevada as well as the foreclosure number is beginning to make a rise in Maryland and Virginia. Nationally, RealtyTrac reported about 340,000 foreclosure filings. If you are facing foreclosure, do not face it alone. Allow 1st Foreclosure Prevention help you to save your home.

Before explaining the crisis let me state that this crisis is not just a housing issue but over the past year has grown into a full blown economic crisis that is affecting all of America.

The housing crisis began with many different factors. Real estate consists of a constant cycle of ups and downs, occasionally the stars align and we have a housing bust, which is what we are suffering through right now.  Most economists place the blame for this on the sub prime mortgage market.

A sub prime mortgage is a loan that is given to a person who has a bad credit score to enable them to purchase a home. Because of the low score this loan will be given an interest rate that is below the prime. During the mid-90’s and early 2000’s there were many thousands of sub prime mortgages issued. In general these loans are not a bad idea and make it possible for many people to purchase homes that they otherwise would not have been able to buy.

However, these loans had many risks associated, such as a few years at a teaser rate before the adjustable rate was applied. Suddenly people found that they couldn’t afford their mortgage payments because the interest had skyrocketed. This led to the record number of foreclosures that have swept across the U.S. in the past year.

As the economy worsens and more people are losing their jobs, even more people are put in a position of not being able to afford their mortgages and are losing their homes. This vicious cycle of the economy worsening and interest rates on ARM’s going higher is not showing any signs of changing. But there are methods that are being used to counteract the ever inflating interest rates and bad economy to help homeowners stay in their homes.

If you are in a position of not being able to afford your mortgage you don’t want to lose your home and all of the money that you have invested in it. It is important that you take steps to educate yourself all about the mortgages and refinances available, the stimulus plan that President Obama has introduced to help homeowners and take some time to speak with someone who knows the ins and outs of the housing crisis and will help you make changes in order to keep your home.  1st Foreclosure Prevention is here to help you save your home.  Do not let the ecomonic crisis crush you.

Refinance- Many homeowners are in an adjustable rate mortgage which means that their payment amount varies; this can make it very difficult to budget and plan for. The new housing stimulus offers these homeowners the option to refinance to a fixed rate mortgage.  There are many different refinancing options to consider, your lender should be able to help you decide on one that will work for you, and help you avoid foreclosure. 

Communicate- Let your lender know what your situation is. Being aware of the problems may lead them to offer you some sort of assistance or plan in order to avoid foreclosure. Lenders have been known to offer a sort of “hold” on your house payments for a few months to enable a borrower to accumulate funds, or find employment. The options you will be offered will depend on the current status of your loan so don’t wait until you are several months behind to contact your lender and apprise them of the situation. 

Take Advantage of Options- companies like 1^st Foreclosure Prevention are dedicated to helping homeowners keep their homes. They work with your lender to help provide solutions to your problem. 

Settle- If you have been let go from your job and have no money coming in, you may have to settle for either part time employment or a job that is not in your field. Even if you are too qualified for the job, take it. Any money coming in is better than none. If you can make your car last a few more years definitely don’t trade in and get a new one. In times like these the priority should be Needs, not Wants.

By taking preventative measures there is no reason why you shouldn’t be able to keep your home and your good credit rating through this financial crisis. Everyone is facing these problems today and needing assistance and guidance is nothing to be ashamed of. Let the helpful folks at 1^st Foreclosure Prevention help you understand the situation and your options.

With jobs being cut all across the country and families losing not only employment but also employment benefits such as medical insurance, there are a lot of expenses for a family that has lost their main source of income. This leads to homeowners defaulting on their mortgages due to the fact that once they put food on the table and pay other important bills there just isn’t enough money in the budget to pay the mortgage.

President Barack Obama is aware of the problems that homeowners across the country are facing in this situation. Many homeowners have adjustable rate mortgages (ARM) that are pushing people into defaulting on their mortgage or creating financial difficulties for those home owners because the adjustable rate keeps going up. A fluctuating mortgage payment is even more difficult to keep up with than a fixed rate each month. At least with a fixed rate you know what the payment will be and can plan for it.  More people are unemployed and home values across America have plummeted which shows the need to have rescue plan in place. A plan to help people keep their homes, and not penalize them for circumstances out of their control.

President Obama has introduced a housing and home owner stimulus plan. This plan makes it much easier for millions of struggling homeowners to stay in their home and even refinance. There are two different ways that home owners will be helped by this stimulus plan.

If you, as a homeowner is in a sub-prime adjustable mortgage and are in danger of losing your home because you are behind on your payments the plan will give your current mortgage holder cash incentives to modify your ARM to a fixed and reduced rate mortgage.

The second way the Obama housing stimulus can help homeowners is to allow borrowers who are current on their mortgages but owe more money on the home than the home is worth to refinance.

This new housing stimulus will help many struggling home owners and help the economy as well.

The rising unemployment and company bankruptcies have put hundred of thousands of families at risk.  Banks have been trying to hold off on foreclosure notices for as long as they can to see what the Obama Administration would bring to the table but as the clock ticks, foreclosure notices are being drawn up and sent out. 

Although housing prices are dropping due to the lowering prices on foreclosed homes, the lack of secure employment for many make the thought of jumping into a mortgage too scary at this time.  Sadly, many of these foreclosed homes will be seen boarded up along even some of the wealthier neighborhoods.  The economy is not only affecting the poor, it is showing no financial boundaries.  

July unemployment rate is at 9.5% and it is predicted to continue to rise.  With the job market faltering, unemployment rates rising, you can pretty much predict the direction that home foreclosures will also go.  Banks are doing whatever they need to do to get the largest return they can on homes facing foreclosure.  Quick turn around is their ultimate goal if it means short sales, loss mitigation or foreclosing on the homeowner.  The biggest deciding factor in what a lender will do regarding working with a homeowner will depend on the homeowners ability and how quickly they react.  The more informed the homeowner is on the foreclosure process also plays a role in the lenders willingness to work with the homeowner to come to some sort of resolution in order for the family to either save their home or at least come out of the situation with the least amount of damage possible.  

It is imperative that a homeowner, as soon as faced with foreclosure papers gets the proper help needed if lost in how to proceed.  The sooner you contact 1^st Foreclosure Prevention, the quicker they can go to work for you in saving your home or finding the best possible resolution for your situation.  Don’t let foreclosure papers be the one you leave sitting on your desk corner.  Even as intimidating as they can be, you do have rights and 1^st Foreclosure Prevention is here to help you utilize those rights to keep your home.

A foreclosure results when a property owner cannot make the principal and or interest payments that are due on his/her mortgage contract. Payments fall seriously behind and the lender seizes the property and sells it to get the return on their investment.

There are several basic steps leading up to a foreclosure but there can be variances of these steps in different states. Be sure to check on the foreclosure laws for your state.

When the payments are in arrears (about three to six months), a NOTICE OF DEFAULT (NOD) is filed at the County Recorder’s Office. This warns the homeowner that he/she is facing foreclosure. This starts a reinstatement period that is in effect until about five days before the home is auctioned off to the public.

This period of time, generally three months, is to give the homeowner a chance to bring his/her payments up to date. If the homeowner fails to catch up on his/her payments a Notice of Sale will be posted on the property and he/she will be given a written notice of the same information. The Notice of Sale is also recorded at the County Recorder’s Office in the county in which the property is located. For three weeks, the Notice of Sale will be published in newspapers located in that county. At this time, a foreclosure sale date will be set.

The public auction occurs on the date, time, and location that were set in the Notice of Sale. The property and deed then go to the highest bidder and must be paid for in cash within twenty-four hours.

Another important thing you need to know is your rights and the laws in regards to the foreclosure procedure. This is where it is imperative if you do not have the time to study up on some complicated laws, that you seek help from a trusted source. There are a lot of programs out there that will offer you settlements and other fad fixes to either help ease the pain of foreclosure or make promises of stopping the foreclosure completely. Some of these programs are legit and can help you to find the best solution for your situation; however, some of them are nothing but mere scams trying to make a fast buck off a bad situation.

Often times you will hear the term short sale come up. That should be your last option and only after talking to someone with experience dealing with foreclosure procedures. A short sale, although it can get you out of a tight spot should only be the last alternative after you have exhausted all other resources. Talking to a loan modification specialist who deals in foreclosures daily can advice you with clear-cut options and what the repercussions, if any, would be.

A loan modification specialist can inform you of any government assistance that you may be eligible for as well as work with your lender to try to help you save your home. The reality is that the lenders really do not want your home, especially if the debt ratio is high. They have enough homes sitting empty on the market as it is. They would much rather work out a feasible plan that will keep you in your home and another home from being boarded up.

Talk to a loan modification specialistbefore ever signing or agreeing to anything. Let them help you save your home and spare you from a bad credit rating and the need to seek new housing.

Picture from: www.flickr.com/photos/hotmeteor/238807510/

There are so many that are afraid of losing their homes or of the value of their home decreasing in this crisis. The press conferences held by Pres Obama raised so much hope and yet the hope seems washed out when faced with these figures: In order to save 1 million homeowners from foreclosure it would take 2 million hours. If you divide 2 million hours by an 8 hour work day, this would equal 250,000 days. At this rate it could take over 1,000 years to save the homes that are currently being threatened by foreclosure.

In order to help the many homeowners that are in need of help we are going to need to turn to honest companies that are willing to work as a middle man between the bank and the homeowner. We need professionals that know the ins and outs of the financial assistance that is being offered by the government and that will be dedicated in helping the home owner save their home.

I would like to quote Barb Weidner – Managing Partner, Operations
It is very frustrating to be “one of the good guys” with the best interest of the client/customer at heart and the news media, government and lenders do everything possible to taint the industry. We are not blind to the fact that there are unscrupulous entities out there who do scam the clients but it’s not all of the companies. The media has sensationalized the stories to be ALL bad and do not even give one sentence that there are companies out there who are doing right by their clients. Instead they make sweeping generalizations about the industry and scare the general public.

Homes everywhere can be saved if we stop accusation and seek the assistance of honest companies that have the heart of the customer/homeowner in mind. The media and others have been pointing the finger for to long and casting blame. We need many facilities to stand up and be the answer in this time of foreclosure crisis.