Here are some startling yet poignant statistics that put our current housing market in perspective: Nationally, home values have decreased 33% from the peak of the market (9/2006). In Minnesota, home values have dropped 11.3% in the last year (2010) alone! One in four households in Minnesota owe more than their home is worth. One in seven households are in default on their current mortgage. As a result, and effort to stave off this housing crisis, mortgage lenders have been more assertive about offering alternatives to foreclosure to homeowners having financial difficulties. Briefly, these options include: - Loan modification- often the mortgage lender will offer to forgive missed payments or add them to the back of the loan, and possibly re-amortize the loan. Coupled with a lower interest rate, this can often make the payments more affordable, hence allowing the homeowner to keep their home.
- Deed in lieu of foreclosure- the homeowner actually forfeits their deed to the bank and eliminates the foreclosure process. Some mortgage lenders will offer a financial incentive to the homeowner. Typically this is only an option when there is only one loan (a first mortgage only) on the property.
- Short sale: this is where the homeowner sells the home for less than what is owed. Mortgage lenders typically agree to take less on the sale and relieve the owner of the mortgage debt rather than go through the foreclosure process.
The federal government has provided financial incentives directly to mortgage lenders for cooperating with homeowners by providing foreclosure alternatives. Oftentimes, the lenders are incentivising homeowners as well for their cooperation. The HAFA program provides up to $3000 to homeowners for participation based on qualification. Foreclosure is certainly an option that should be avoided. Foreclosure is a long term, financially damaging process that is dictated to you by the lender. Without conversation or negotiation… They tell you when they will take your home. They tell you when to be out. They tell you what financial repercussions they are going to impose on you. With all this said, every homeowner’s situation is unique. Sometimes personal variables eliminate one or the other or even all of these options. Our job and overall philosophy at Help-U-Sell Guardian Realty is to provide our clients with ALL of the information on ALL of the options and allow our clients to make a decision on what is best for them. Our job is to tell our clients what they need to hear. Sometimes that is different than what they may want to hear, but it is honest, constructive, and given with our clients long term best interests in mind. We want our clients to feel empowered to make a wise choice. We want our clients to once again be able to sleep between 2 and 5 AM; knowing that the choice they made is the best for them and their family. Unfortunately, we cannot cover specifics in some computer generated emailed “personalized report.” As stated before, every situation is unique. Therefore the solution that may be best for you may not exactly be what the “personalized report” may suggest. Most of these “personalized reports” are just tools to capture your contact information anyway. We kindly ask that you call or email us. We can set up at time and then together make a plan that includes your personal situation as well as financial and family objectives. Moving forward with a plan that puts YOU in charge. |