Your Mortgage Crisis Does and Dont’s

Unfortunately this is an extremely difficult subject for homeowners. With the emotionals ties to the home and in many cases a strong moral convictions to abide by the rules; good people still find themselves staring at a foreclosure and the embarrassment of losing their home. This article is directed at minimizing the damage associated with this trying time.

The First Step

Nope, I am not going to tell you to call your mortgage company’s loss mitigation department. What I would say is to determine if at the end of the day you can really make the payments even if your mortgage company allows you a forebearance or a cash out refinance to get caught up. In many cases this just prolongs the pain. Based on the credit situation you are now in, you are not going to get a lower rate and a lower payment. So decide first if the payments or your equity(if any) are really worth fighting for. May sound cold but I am not one that likes extended pain.

Second Step

Nope, I am still not going to tell you to call your mortgage company. Whether or not you decide to fight for your home or not, absolutely do not call the mortgage lender yourself. You are too close to the issue and emotional about the home. Have a third party company handle this for you. There are a few good ones out there who know the right people to speak to directly at your current mortgage company. They also know exactly what to say and do. They also know the limits of the mortgage companies, they know who to call and hard to push to accomplish the best results. Do not do this yourself.

Short Sale Hell

One last tid bit. If you decide to short sell your home with the help of a Realtor make sure you know your mortgage loan facts. The first thing the lender is going to ask from your Realtor, which trickles down to you, is a short sale package proving hardship. They will want your w2’s, tax returns, and your story. If you own multiple homes or stated your income in order to purchase the home you are getting ready to short sale, then this may present legal ramifications such as mortgage fraud. Basically by sending in your short sale package to your lender you have incriminated yourself. Could be even worse if you do so and you hold some type of state licensure. Your mortgage company may have more reasons to go after you for fraud. The best thing to do is nothing. Do not contact the lender and just let the property go. Do not complicate matters. Let a third party company, and not a Realtor, handle this for you if at all.

This topic is not one of my favorites. This article is intended for those good people who just do not know or understand the mortgage industry. I have just seen too many people burned by unscrupulous loan officers and real estate agents trying to help themselves and not the mortgagee who will do anything to not have this agony hanging over their head. I do not condone any of these tactics but unfortunately this yields the best outcomes for homeowners in trouble.