There is a foreclosure epidemic sweeping across the United States and there looks to be no end in sight. Borrowers stuck in made to order mortgage can no longer refinance and they are stuck in loans that are adjusting higher and higher. Loan to values are near or at 100% and their payments are sky rocketing.
Something has to give!
Politicians and senators are stepping in to the picture. FHA, Fannie Mae are Fredie Mac are brainstorming possible solutions. Big banks and servicers such as Countrywide, Wells Fargo, Chase, AMC and Litton are starting to ramp up their loss mitigation departments to combat this wave that is sweeping people out of their homes and banks out of their profits.
There is talk of wide spread loan workout programs and loan modifications to off set these exploding ARM loans that are causing peoples homes to be foreclosed on. Meanwhile it’s not helping the hundreds of people whose lives are devastated daily by foreclosure and the after affects that last for years.
The servicers seem to be caught in a tug of war between the client and the investors. The investors want the servicer to foreclose but they fail to realize that most of these homes have no equity. How long can they take back borrowers homes that have no equity and let homes sit on the market like they are now? How long before it eats the investors profits until they realize that the best solution is to modify loans ASAP and stop playing hard ball with people that are a victim of circumstance?
Loan workouts are the only logical solution to the foreclosure epidemic and lenders need to do what they can to step in and step up their efforts.
{ 2 comments… read them below or add one }
Can you do a short sale and a loan modification. I’m right at that point. I have a call into the lender to do a loan modification, but I don’t think they will approve it do to the financial numbers. I also have a short sale in process but the lender denied the first offer and hasn’t said anything about a counter offer. What do we do from here? I would ideally like to sell it because the payments will still be to high for me, but I want to buy some time with the lender before it goes into full blown foreclosure with a sale date with the sheriff’s dept.. Am I to late. They sent me a intent to foreclose and I’m not sure they will work with a short sale if they think I can afford to pay on the new loan that they come up with. What to do????
I would push them to extend the date and give you time. They never stop the foreclosure process and that’s why some people are surprised that they get these notices after they have spoken with the lender. That will always keep moving forward.
If you have an agent. That agent need to do their job and be on that lender 24/7 on your behalf. That agent works for you and needs to earn that commission.
Who is your lender or servicer?