So you've had some problems that made it difficult or impossible for you to pay your mortgage. Now you want to get a loan modification so the monthly payment is reduced to an affordable level and the threat of foreclosure goes away. But how do you go about applying... and will your lender support you?
Most people don't plan for it, but about half of all marriages end in divorce. And when a couple decides to go their separate ways, their property has to be divided up or sold. Some property is easier to divide than others. A couple's Beanie Baby collection is relatively easy to deal with in divorce. It has some positive value, can be sold, and easily carved into two pieces. Your underwater home, on the other hand, is the opposite. It can't be cut in two or immediately sold and is harder to deal with because of that.
When life hands you lemons, you make lemonade. Even if what's sour is something as consequential and life-altering as foreclosure. There are countless examples of people experiencing a terrible event in their life and turning it into a positive. It's hard for anyone in the middle of a difficult situation to imagine how something bad can be good in the long run. And to be fair, it may not. But you can maximize the chances of making your sour situation sweet by turning your attention to what you can do to fix it.
As 2015 comes to an end, those who watch and analyze the housing market are examining the data for the year and making predictions for the next. There is mostly good news, and as always with real estate it's all about the location. What really matters is what's going on in each homeowner's finances and life, and what options are available to them. So, let's look at some of the data for 2015 and the industry predictions for 2016 and see what it means for you.
Your lender has been watching you all year, and knows if you've been naughty or nice. But if you make their naughty list by not paying your mortgage, they don't come down your chimney and leave you a stocking full of coal. They'll do something much worse and take your home, chimney and all. Unlike Santa Claus' naughty and nice lists, you should know for sure which one you are on. What is harder than knowing is getting off of the naughty and onto the nice list so you can stay in your home.
Your mortgage lender has a very simple rule for determining whether you're naughty or nice. It's determined by whether or not you pay your mortgage on time every month. If you pay on time, you get to be on the nice list. Keep up the good work. What's your reward? Keeping your home, and not being threatened with the 'f' word. That's not the four letter 'f' word, it's the one with 11 letters: foreclosure.
If you're experiencing a temporary hardship that has caused you to be unable to make your monthly mortgage payments, a forbearance agreement is an option to consider that helps you keep your home out of foreclosure until your hardship passes. A forbearance agreement allows you to:
- Reduce or suspend mortgage payments
- Stay in your home
- Avoid foreclosure
- Have time and flexibility to overcome your hardship
Is it possible to make too much money? You might think that it's not any more possible than being too good looking, too smart, too healthy, or too happy. Having too much of any of those positive things is what most of us would call a high quality problem, so the question is too much for what? If you're trying to get a mortgage loan modification, the answer is yes, you can make too much money to qualify.
People have difficulty paying their mortgage for a variety of reasons. They lose their job, get divorced, or incur costly medical bills, to name a just a few common hardships. To make ends meet when a hardship happens, some are able to reduce spending on nonessential items like entertainment, vacations, and eating out. If that's not enough, things that are necessary, but can be put off, are. If reducing spending does not free up enough cash to pay for essentials like mortgage, car, and utility payments, tough decisions have to be made.
Foreclosure can be a confusing subject that mystifies all but the most well-versed professionals. All the ins and outs, the what have yous, and esoteric legal language make it difficult to understand the benefits and requirements of various options. However, there are ways to stop foreclosure that are simple and easy to understand for any homeowner. One of the easiest ways is a revolutionary concept that involves paying the money required to bring the loan current. It's called reinstatement.
The Hardest Hit Fund (HHF) was created by the federal government in 2010 to give financial aid to struggling homeowners in states that were most negatively impacted by the housing crisis and recession through loan modifications, mortgage payment assistance, and transition assistance programs. States were selected to receive funds from the program based on having above average rates of unemployment and decline in housing prices.
