Foreclosure - 3 Pieces of Advice That Will Immediately Help the Homeowner in Trouble
Good advice is hard to come by these days, especially if the people giving you that advice stand to make serious money from your misfortune.
It seems like every time a homeowner gets into a tight spot, there's a whole crew of professionals ready to "help them" get out of that jam.
Whether it's a refinance with a loan officer, selling the home, conducting a short sale, or using a credit counseling service, there is big money to be made off of real estate (and homeowners) in a tight spot.
Be prepared for an onslaught of offers to help you if your in foreclosure.
After speaking to thousands of homeowners in that position, I believe the 3 following tasks should be tackled immediately.
First step: Write a detailed "Hardship Letter" for your lender.
When you call your lender for help, you need to be prepared.
Your lender will most likely request that you supply them with this handwritten letter explaining the circumstances surrounding your mortgage default.
They want to understand your position, what events contributed to your default, and why you could not make your payments.
It's always a good idea to close the letter with a short paragraph that explains what your game plan will be from this point forward, so that you won't end up in foreclosure again.
This closing paragraph shows the lender how serious and proactive you are about getting back on track with your mortgage.
This is NOT overkill, I assure you.
Remember, your lender has no idea of the specific circumstances that led to your foreclosure, so it's your job to put that in writing for them.
Don't leave anything out, all details are important.
Second step: Gather as much backup documentation as possible to submit with your Hardship letter.
You may feel the need to weave a great story that explains your predicament, but it could backfire.
Lenders typically ask for receipts, hospital bills, mechanics invoices, and any other documentation that will reinforce your letter.
Third step: Immediately attempt a "Loan Modification" with your lender's Loss Mitigation department only - Do NOT attempt to negotiate or work out a payment plan with the customer service representative who answers the phone.
I refer to the agents who answer the phones as "worker bees".
The worker bee has very limited power when it comes to your foreclosure; they have NO authority to make any decisions and they have NO incentive to help you.
In fact, they really don't care one way or another happens with your mortgage, they just get paid to answer the phones and say whatever the script tells them to.
When you're on the phone with the worker bee, tell them that you're calling to "Modify" your existing loan and that you need to speak to someone in the Loss Mitigation department, or the Loan Modification department.
These are the people that make the real decisions; they are who you want to speak to.
The worker bee will try to get involved in your loan and may even ask you for a portion of the past due money you owe.
Be courteous, but don't allow them handle anything important.
This is a job for the decision makers in the Loss Mitigation departments; they handle loan modifications all day long and it's their ONLY job.
You don't want anyone fiddling around with your mortgage terms that could care less what the outcome may be.
One last thing, have all of this information in front of you and memorized when you call your lender.
The last thing you want is to give your lender the feeling that your unfamiliar with your story / circumstances.
If you're in a conversation with your lender and they question a time frame or an event, you want your data in front of you for quick reference.
If you're in foreclosure, time is your enemy and you need to act now.
Please visit our web site at http://www.
DIYforeclosure.
NET for more ethical insight and additional information about handling this issue yourself -without going broke.
It seems like every time a homeowner gets into a tight spot, there's a whole crew of professionals ready to "help them" get out of that jam.
Whether it's a refinance with a loan officer, selling the home, conducting a short sale, or using a credit counseling service, there is big money to be made off of real estate (and homeowners) in a tight spot.
Be prepared for an onslaught of offers to help you if your in foreclosure.
After speaking to thousands of homeowners in that position, I believe the 3 following tasks should be tackled immediately.
First step: Write a detailed "Hardship Letter" for your lender.
When you call your lender for help, you need to be prepared.
Your lender will most likely request that you supply them with this handwritten letter explaining the circumstances surrounding your mortgage default.
They want to understand your position, what events contributed to your default, and why you could not make your payments.
It's always a good idea to close the letter with a short paragraph that explains what your game plan will be from this point forward, so that you won't end up in foreclosure again.
This closing paragraph shows the lender how serious and proactive you are about getting back on track with your mortgage.
This is NOT overkill, I assure you.
Remember, your lender has no idea of the specific circumstances that led to your foreclosure, so it's your job to put that in writing for them.
Don't leave anything out, all details are important.
Second step: Gather as much backup documentation as possible to submit with your Hardship letter.
You may feel the need to weave a great story that explains your predicament, but it could backfire.
Lenders typically ask for receipts, hospital bills, mechanics invoices, and any other documentation that will reinforce your letter.
Third step: Immediately attempt a "Loan Modification" with your lender's Loss Mitigation department only - Do NOT attempt to negotiate or work out a payment plan with the customer service representative who answers the phone.
I refer to the agents who answer the phones as "worker bees".
The worker bee has very limited power when it comes to your foreclosure; they have NO authority to make any decisions and they have NO incentive to help you.
In fact, they really don't care one way or another happens with your mortgage, they just get paid to answer the phones and say whatever the script tells them to.
When you're on the phone with the worker bee, tell them that you're calling to "Modify" your existing loan and that you need to speak to someone in the Loss Mitigation department, or the Loan Modification department.
These are the people that make the real decisions; they are who you want to speak to.
The worker bee will try to get involved in your loan and may even ask you for a portion of the past due money you owe.
Be courteous, but don't allow them handle anything important.
This is a job for the decision makers in the Loss Mitigation departments; they handle loan modifications all day long and it's their ONLY job.
You don't want anyone fiddling around with your mortgage terms that could care less what the outcome may be.
One last thing, have all of this information in front of you and memorized when you call your lender.
The last thing you want is to give your lender the feeling that your unfamiliar with your story / circumstances.
If you're in a conversation with your lender and they question a time frame or an event, you want your data in front of you for quick reference.
If you're in foreclosure, time is your enemy and you need to act now.
Please visit our web site at http://www.
DIYforeclosure.
NET for more ethical insight and additional information about handling this issue yourself -without going broke.
