Repair credit after a foreclosure leaves a person with a chance to get a new start on life. It’s not the end of the world…by any means as long as you develop a recovery plan.
These are scary times! With hope and a recovery plan, you can recover from foreclosure.
Chances are, you know someone (perhaps you) suffering through this nightmare…and you see the fear and uncertainty in (your) children’s eyes no matter how hard you try to shield them from the horror.
RealtyTrac, a leading website tracking pre-foreclosures and foreclosures, announced today that US foreclosure filings were up 71% in the third quarter over the same period last year. Almost 766,000 homeowners had a sheriff show up at the door with a foreclosure complaint in hand.
Daily, I talk with people whose lives are shattered–they don’t know the foreclosure process or how a foreclosure will affect them.
My gosh, they don’t even know where they’re going to go. They don’t have a plan.
Most people facing foreclosure do NOT know the following secrets about facing and/or avoiding foreclosure:
THE FORECLOSURE REALITY…
Most people emotionally destroyed by the thought of losing their home do not realize the should:
- Call their mortgage lender(s) immediately!
- Take their lender’s calls if they’re behind in payments or about to get behind in payments. What you (or they) will discover is that mortgage lenders are a (little) more receptive today toward adjusting your mortgage amount and monthly payment to reflect today’s values.
Whether or not you think this is fair, it is BEST for all of us!
Keep people in their homes! Foreclosed properties are destroying neighborhoods, creating migrations challenges not seen since The Great Depression & destroying the US economy.
Here’s what I believe will happen, and I’m not a Ph.D. economist or soothsayer. To me, this is common sense. Mortgage lenders will go to homeowners facing foreclosure and reduce their mortgage amount and payments to today’s value.
For instance, If you’re in trouble on your mortgage and your home is worth $200,000 today but you owe $300,000, your mortgage lender will write down $100,000 and reduce your monthly mortgage around $500.00 to reflect today’s value. Your mortgage lender MUST do this! There are few options today! This catastrophe has turned into a national disaster.
Keep in mind, I predicted a bailout, and now I’m predicting an even BIGGER bailout like you’ve never seen before. The FEDS will force mortgage lenders to force YOU (an investor in your pension, 401K or IRA) to bleed your retirement fund even more in order to put a tourniquet on this national disaster.
Six states are MELTING down…economically!
Over 60% of the foreclosures are taking place in 6 states: Arizona, California, Florida, Michigan, Ohio, and Nevada.
If you think for a moment that short sales and REOs are just a 2008 event you’re crazy. Foreclosures will continue well into 2010 as the market absorbs the inventory that is just now coming online….
Alan Greenspan, famous for his “irrational exuberance” comments that took the air out of the Internet bubble, now has a new moniker he’ll be known for: “Credit Tsunami.” Greenspan testified before Congress this morning and told lawmakers that he was in a state of “shocked disbelief” over the extent of the credit crisis and the credit tsunami that has ensued.
Oh really? Greenspan, who orchestrated this national disaster, expresses shock and disbelief in what has happened. Ironically, every “Joe Q. Public” I talked to 3 years ago couldn’t believe the Feds weren’t reining in the out-of-control housing market. Everybody knew CREDIT was too easy and that people who couldn’t afford homes on those ridiculous “pay-option-arm” loans were being set up for foreclosure.
They KNEW the party could NOT continue….
The former Fed Chairman said that the key to relief will be stabilizing home prices, which he doesn’t foresee happening for “many months in the future.”
According to Greenspan, “Given the financial damage to date, I cannot see how we can avoid a significant rise in layoffs and unemployment,” Greenspan said. “Fearful American households are attempting to adjust, as best they can, to a rapid contraction in credit availability, threats to retirement funds and increased job insecurity.”
This is “Trickle-Down Economics!” It’s not a trickle; it’s a gusher!
In days to come, I will talk more about credit repair after a foreclosure. For now, you must talk to your lender. For heavens sake, do not let your pride, fear or lack of understanding keep you from calling your lender(s) or taking your lenders’ calls
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