Facing Foreclosure in California?Maybe Some Hope!

If you're one of thousands of Californians currently facing foreclosure, there may be some new hope of relief.The legislature is currently discussing creation of a mediation program to help you work things out with your lender. If created, it would bear some similarity to programs of this sort in a number of other states. While final details are not yet set, and will take quite a bit of discussion by lawmakers, the basic way it would work is that borrowers facing loss of their home by foreclosure would request a mediation with their lender. The parties would then sit down and try to work out a loan modification that would create more manageable loan payments for the borrower, thus helping his avoid foreclosure. Such items as fees for the process, to help cover its costs, are one of many things under discussion. Likely they would be a few hundred dollars, and would go to the mediator hearing the case.
Final discussion on the bill would likely be in January after the legislature gets back in session.

Do you have a Countrywide Loan?

For those of you who took out a mortgage from the now-defunct Countrywide, there may be good news. Bank of America, who took over Countrywide, has helped 100,000 borrowers in this group avoid foreclosure. This was done through its National Homeownership Retention Program (NHRP), a program to provide mortgage foreclosure relief to homeowners who are eligible under the program. If you are one of the lucky ones, you know about this already. If you haven't heard about it and have a loan from Countrywide, call your BofA office IMMEDIATELY! You may save your home! Good luck--and a Happy Thanksgiving.

Possible Good News!

Although it's just an idea at the moment, Rep. Barney Frank (D-Mass) has proposed extending the TARP relief program for financial institutions beyond its scheduled December 31 end--PROVIDED it include funds to assist unemployed homeowners make their mortgage payments until they are again fully employed. The proposal would take funds for these payments from the already repaid $12 Billion that TARP-receiving banks have repaid. Whether this proposal becomes law remains to be seen, but it does show that someone in Congress is at least looking out for the 'little guy' who's having trouble making the mortgage through no fault of his own.

BEWARE!

One thing that's becoming very obvious as we move through the third consecutive year of the foreclosure crisis is that sometimes a loan modification doesn't help the homeowner at all! This is largely due to the fact that when the mod was approved, the terms, though an improvement over the loan's original terms, still were set at levels that the borrower could not comfortably afford, if they were affordable at all. When negotiating a loan mod, you must keep in mind that a mod with terms still too difficult for you to comply with is as good as no mod at all. CAREFULLY examine terms offered to you for any modification. If they are workable, by all means give serious consideration to them. Take the additional precautions of discussing them with your financial advisor and attorney. Then, if the terms are still good, go ahead. Good luck!