It is no secret that a number of our residents and fellow Michigander's are facing some economic challenges that are affecting their ability to maintain their quality of life. More and more individuals and families are finding it increasingly difficult to make their mortgage payments resulting in possible foreclosure. The most unfortunate thing is that many do not realize that they don’t have to lose their homes. In many cases, there are programs available designed to assist homeowners in getting back on track. If you are facing foreclosure, there is help available
1. Don't ignore the problem. The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house.
2. Contact your lender as soon as you realize that you have a problem. Lenders do not want your house. They have options to help borrowers through difficult financial times.
3. Open and respond to all mail from your lender. The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notices of pending legal action. Failure to open the mail will not be an excuse in foreclosure court.
4. Know your mortgage rights. Find your loan documents and read them so you know what your lender may do if you can't make your payments. Learn about the foreclosure laws and timeframe's by contacting the Michigan State Housing Development Authority at 517-373-8370.
5. Understand foreclosure prevention options. Valuable information about foreclosure prevention (also called loss mitigation) options can be found at www.fha.gov/foreclosure/index.cfm.
6. Contact a HUD-approved housing counselor. The U.S. Department of Housing and Urban Development (HUD) funds free or low-cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances, and represent you in negotiations with your lender if you need this assistance. To find a HUD-approved housing counselor near you, go to www.hud.gov or call (800) 569-4287 or TTY (800) 877-8339.
7. Prioritize your spending. After healthcare, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment. Look for optional expenses that you can eliminate such as cable TV, memberships, or entertainment.
8. Use your assets. Do you have assets such as a second car, jewelry, or whole life insurance policy that you can sell for cash to help reinstate your loan? Can anyone in your household get an extra job to bring in additional income? Even if these efforts don't significantly increase your available cash or your income, they demonstrate to your lender that you are willing to make sacrifices to keep your home.
9. Avoid foreclosure prevention companies. You don't need to pay fees for foreclosure prevention help, use that money to pay the mortgage instead. Many for-profit companies will contact you promising to negotiate with your lender. While these may be legitimate businesses, they often charge a hefty fee (often two or three month's mortgage payments). Contact your lender or a HUD-approved housing counselor to find out about free help that they can provide.
10. Don't lose your house to foreclosure recovery scams. If any firm claims they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf, you may well be signing over the title to your property and becoming a renter in your own home! Never sign a legal document without reading and understanding all the terms and getting professional advice from an attorney, a trusted real estate professional, or a HUD approved housing counselor. (Source: http://www.hud.gov/foreclosure/)
Home lending and foreclosure scams are costing Michigan residents thousands of dollars and often their homes. Those who are particularly vulnerable are senior citizens and those with low incomes or poor credit. Don’t allow yourself and your family to fall victim to one of these scams—educate yourself.
Be very cautious of any claim that promises to lower your monthly mortgage payment while also promising that in a short time you can own your home free and clear of debt. Further, con artists will seek you out. If you find yourself in foreclosure proceedings and receiving solicitations at your home via telephone, letter, home visits, etc., it is most likely these are attempts by scam artists to take advantage of your situation.
Complaints may be filed with the Attorney General’s Office at:
Consumer Protection Division P.O. Box 30213 Lansing, MI 48909
National Foundation for Credit Counseling / Homeowner Housing and Credit Counseling http://www.nfcc.org/ 800-388-2227
Federal Housing Administration http://www.fha.gov Provides certain sub-prime borrowers refinancing opportunities 1-800-CALL-FHA
U.S. Department of Housing and Urban Development For further information on foreclosures and to locate a Home Ownership Counselor http://www.hud.gov/foreclosure
