Foreclosures: How many people do you know?
Question:
Answer:
Well, well! You've asked the right question on the right day. I live in Ohio and we're flip-flopping with Michigan and Florida on any given day for who's #1 in foreclosure rates.
I used to work at a non-profit that speciallized in promoting homeownership. There was a great need to begin counseling those who were in danger of losing their homes, so we started doing that. I do know of many cases (but I don't know them personally).
Any-who. At our busiest, I'd say we counseled about 50 new people in a 1 month period. The flow was not always THAT high, but it was steady...and we were not the only foreclosure counselors in the city, so many were being serviced at other places.
My organization was able to give gap loans to qualifying clients. We could loan up to 3K to bridge the delinquency gap. Those loans were tacked on to the end of their mortgages. Unfortunately, there were many cases that were beyond saving. The clients did not communicate with their lenders immediately (like they were supposed to) and instead spiraled out of control by living off credit cards and letting those bills and others go.
Some cases were just really ugly. So basically, we just did the gap loans. The clients were beyond forbearance and payment arrangements.
For those who were able to avoid it, everyone in the household who was old enough to work went to work. If they already had a job, they got another. (Talk about bootstraps!) Some clients traded in their vehicles for less expensive ones and sold "extras" like motorcycles and boats. Some others were able to refinance their mortgage with a different company. The interest rate was an incentive-rate type deal at first (hence, the foreclosure issues), but their payments were reduced and that helped.
Unfortunately, I've seen a bit of everything.
My next door neighbor decided to go into foreclosure because she's a single mom and just couldn't afford the mortgage payment any longer. She moved herself and her daughter into a more affordable apartment. Her credit is totally ruined, but she has a decent job and receives child support to help pay for her daughter's education.
the best mechanism to avoid it is to pay your monthly mortgage payments on time. if you forsee a problem of making ur monthly payment contact your company BEFOREHAND to make arrangements so that you can not have it reflect negatively on ur account. the worst thing on ur credit report is late mortgage payments. If you notify your company ahead of time they can try to not put this penalty on for you. if you keep mamking late or no payments then it will be bad on ur account and eventually ur mortgage company will view you as a liability and start sending u letter.s be in constant communication with ur company if u forsee these problems so you can elliviate future forclosure.
I recently read an article in regards to people getting out of foreclosure by putting their arrears back into their mortgage and changing the payments to a higher dollar amount.
The only bad thing is that the IRS will account for that as income and tax you at the end of the year.
So, if you were $30,000 behind in your mortgage payments, they will count that as income for that year. It stinks but at least it will keep a roof over peoples head.
More Related Questions & Answers...