FREQUENTLY ASKED QUESTIONS
- What is foreclosure?
- How can loss mitigation help you?
- What is Loan Modification?
- Can I negotiate with the lender myself?
- How long do I have to act?
- Can you help me improve my credit rating?
- How long does it take for you to complete the case once we fill out all of the paperwork?
- Do I have enough time to stop my foreclosure?
- What if I can no longer afford my home? Can you still help me?
- What is a short sale?
- What are the advantages of a short sale?
A. It is the legal and professional proceeding in which a mortgage, other lien holder, usually a lender, obtains a court ordered termination of a mortgagor’s equitable right of redemption.
Q. How can loss mitigation help you?
A. The goal of loss mitigation is to work out an agreement between the homeowner and the lender that will stop foreclosure proceedings permanently. One of the most common methods is a loan modification. This allows the homeowner to stay in their home and can help protect their credit history.
A. This term has been getting a lot of attention lately and rightfully so given the nature of the current market. When homeowners are stuck in a mortgage and cannot refinance out of them, loan modifications may be the only way to assist. This is done when your lender modifies your current mortgage (same loan you have, only changes are made to the note) in order to work with you and make your mortgage more affordable. A modification to your rate, principle balance, delinquent fees owed, term of loan or a combination of all can be made by the Lender. In today’s market this may be the best way to help people avoid foreclosure.
Loan Modification will change the existing mortgage note and give the client a fresh new start in managing their home mortgage. A successful modification will result in the account being brought up to date immediately.
Q. Can I negotiate with the lender myself?
A. Yes. If you are only a payment or two behind and your lender has not hired an attorney to begin foreclosure proceedings you may be able to negotiate a work out agreement yourself. If you are successful then you have saved yourself some funds that can be used to get caught up on your mortgage. Just remember, don't waste a lot of time on this. Time is not on your side right now. If you don't have something worked out within 1-2 weeks, then it's obvious that your lender is not serious about working things out with you directly. When you get to that point you will be better served by professional representation that can use the formal business and legal protocols to your advantage. We deliver the critical information and professional representation that you need to get the best possible work out agreement with your lender.
A. Time is of the essence when you are behind on house payments. Time is definitely not your friend in this situation. Each day that passes makes it that much harder to get a work out agreement with your lender that you can live with. The home foreclosure process can take anywhere from a few weeks to many months, depending on your state law and the method of foreclosure your lender chooses to use. In most cases the sooner you begin the process the better chance you have to achieve your desired result.
Q. Can you help me improve my credit rating?
A. We are not a credit repair service but we do strongly recommend the seeking the eservices of a trusted credit repair professional. We have referral partners we can recommend to help you but right now, of course, the best thing you can do to help your credit is to prevent foreclosure.
Q. How long does it take for you to complete the case once we fill out all of the paperwork?
A. Anywhere from a few weeks to several months. This depends on the stage of foreclosure you are in and the backlog of cases YOUR lender is facing. Many institutions in today’s environment are facing an over-whelming demand. This is just another reason to rely on a professional who has existing relationships with lenders nationwide. Typically it takes several weeks to complete a work out agreement and stop foreclosure proceedings.
Q. Do I have enough time to stop my foreclosure?
A. Up until the foreclosure sale occurs there is still hope. If a sale date for your house has been set you need to act fast. We have stopped sales set within a few days but this is very risky and some lenders will not agree to it. Your best option is to take action immediately to stop foreclosure before it goes too far!
Q. What if I can no longer afford my home? Can you still help me?
A. Yes. If you are certain that you cannot afford your home any longer and wish to sell, we can help you to secure a short sale.
In a short sale, the Lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's Loss Mitigation department. With this agreement, the lender releases the borrower from the mortgage, thereby preventing foreclosure.
Q. What are the advantages of a short sale?
First, it can minimize the negative impact on your credit. A foreclosure can remain on your credit for up to seven years while a short sale usually gets reported as a “settled debt” and is significantly less damaging. Second, it can minimize financial exposure/liability with the lender. When a lender is forced to foreclose on a property the lender will ultimately sell the property at a significant discount. In these situations the homeowner can then be financially liable to the lender. While this can still happen with a short sale the difference is important to note. With a short sale the homeowner is still involved in the process and can therefore contribute their input and have more control over the sale price of the property and the potential associated liabilities. In fact, in many cases the homeowner can and should negotiate for no deficiency or a lower deficiency with favorable terms. However, once the lender repossesses the property, the homeowner is typically defenseless with respect to what follows next.