FHA Loans –
If you are in a home with an FHA loan contact a HUD approved housing counseling agency (1-800-569-4287 or TDD: 1-800-483-2209) and work with them to help you out of this mess. They are there to help you! FHA loans have a few options –
1. Special Forbearance – This is where your lender arranges for you to arrange for a repayment plan which could include temporary reduction in payments or a suspension of your payments. An involuntary reduction in your income or a significant increase in your living expenses may assist in qualification.
2. Mortgage Modification – A mortgage modification is when your debt is refinanced or extended so that the monthly payment is reduced. To qualify you will need to have recovered from your financial problems but your net income is now less than before.
3. Partial Claim – Sometimes a lender can help you obtain an interest free loan from HUD so you can bring your loan current. This would still need to be repaid.
4. Pre-foreclosure Sale – You may sell your property and pay off your loan and avoid a foreclosure.
5. Deed-in lieu of Foreclosure – This allows you to “give back” your property to the lender. You won’t be able to keep your house but this will help keep your costs down and will keep a foreclosure off your record.
FHA Loss Mitigation Center is available to help you at 1-888-297-8685 if your lender is not working with you the way you feel they should.
With conventional loans you’ll need to speak with the loss mitigation department with your specific lender. Be sure to request a negotiator or counselor and a “workout package”. If your loan has been purchased by Fannie Mae or Freddie Mac there are guidelines the lender should follow to determine options. Freddie Mac and Fannie Mae don’t work with borrowers directly – they work through the lender, also known as the loan servicer.
If your lender will not work with you or you receive poor service (and your loan is now owned by Freddie Mac) you may call their customer service at 1-800-373-3343.
Remember, anytime you are working through a loss mitigation, refinance, mortgage modification or any other option be careful of scams. HUD says to watch out for:
– Equity skimming – when a buyer says they will repay your mortgage or sell your property if you will just sign over the deed and move out.
– Phony counseling agencies – counseling for a fee when there is someone you can go to and get the counseling for free.
– Don’t sign anything if you don’t understand it!
If you are behind in your mortgage payments or think you are going to be behind very soon – CALL YOUR LENDER and CALL CENTURY 21! We are here to help you!