What to do if you are facing foreclosure
January 5, 2007 | Foreclosure | 
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Too often, those facing foreclosure do nothing. That just aggravates the problem. What should be done and who do you contact to help? Here is a good checklist for someone facing foreclosure.
Act now The threat of foreclosure does not go away if you ignore it; it just gets worse. The earlier you act, the better. When you fall too far behind, it makes it very difficult to salvage the situation.
Get independent counseling Many agencies offer free advice to homeowners who need it. The Department of Housing and Urban Development (HUD) has a list of certified counselors on its Web site and NeighborWorks has a toll free number (1-888-995-HOPE) that refers people to counselors in their area.
An advisor can examine a homeowner’s income and expenses for ways to work out a viable budget and possibly keep the house.
Talk to your lender The reality is that your lender doesn’t want the property back. Lenders found out years ago that foreclosing is not profitable for them. It’s better for them if things can be worked out.
That could mean suspending payments for a period or reworking the length of the loan. Lenders have two departments that handle delinquencies - the collection and the mitigation departments.
Collection has one goal; get payments, but mitigation’s main role is to assess and work out the situation, if possible. When you call for help, ask for the mitigation department.
Talk to a lawyer I would suggest not to sign anything or agree to anything without discussing it with a professional.”
But the emotional aspect of facing foreclosure can cause some borrowers to act against their own best interests. The key for borrowers is to be proactive; pursue the best result they can achieve and that means understanding all the options. Many don’t.
According to statistics, between 40 percent and 50 percent of the people actually foreclosed on have had no contact with either their lender or a counseling agency.
Some may have been able to salvage the situation had they acted when they first got into trouble.
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Stay away from the foreclosure rescue operators who solicit you by junk mail, phone calls, and even show up at your front door with a briefcase full of legal papers that they want you to sign in order that they can “help” you.
To get links for stories of financially strapped homeowners who had their home equity “stolen” from them because of dealing with unscrupulous foreclosure rescue operators, click the link below from The Home Equity Theft Reporter:
http://homeequitytheft-cases-articles.blogspot.com/2007/01/unwitting-title-transfers-foreclosure.html