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How do I contact my lender?
Answer: If you are facing foreclosure problems, it is best to contact your lender to let them know of any pending or current financial problems that have resulted in any mortgage non-payment. To contact your lender, look on your monthly statement for a phone number, which is usually an 800 number. Make sure you note the person that you speak to on the phone. Ask the phone rep for a fax number and follow up with a letter explaining your situation with some kind of scheduled date when you can make a payment. The letter will serve as proof that you did make an attempt to resolve the issue.
How do I find out what type of loan I have?
Answer: To find out what type of loan you have, look at your mortgage note or mortgage documents that you should have received at time of closing. If you are still unsure how to find it, call your lender and ask for assistance. The Truth in Lending form (also known as TIL) is a disclosure form that you should have a copy of that will divulge information about what type of loan you have as well as the cost of your loan. You will also be able to retrieve a copy of the completed Uniform Residential Loan application (also known as 1003 form) to see the type of amortization whether fixed, ARM, GPM or other type. You can see what the 1003 form looks like at https://www.efanniemae.com/sf/formsdocs/forms/pdf/sellingtrans/1003i.pdf
Do I qualify for assistance?
Answer: If your financial situation is temporary, the lender may work out a forbearance agreement to suspend or reduce payment for a specified amount of time. If you can prove that your financial situation is legitimate, the lender is more likely to provide assistance. Lenders don't like to force people out of their homes. They will work with you to find the best possible solution. If your income has been considerably reduced and you can prove it, the lender may modify the loan to freeze your interest rate if you have an adjustable loan. The lender may also consider allowing you to put the house on the market and accept the sale proceeds as settlement of the loan. Each lender operates differently.
How long do I have before I am evicted?
Answer: Most lenders will start foreclosure proceedings when you have missed about three payments. You can check your mortgage agreement, which generally defines when your lender will begin foreclosure proceedings. The lender will send a default notice to notify you of pending foreclosure document filing and will request a trustee's sale or a judicial foreclosure to sell the property at a public auction. The default notice will indicate the specific date of the auction. You have three days after the sheriff sale to vacate the property. However, from the day you are given the default notice until a sheriff comes to move your possessions out of the house, the new owner can use their discretion and file court paper with a definitive date to get you out.
How do I get approved for housing after a foreclosure?
Answer: There are sub prime lenders that may consider giving you a mortgage loan after foreclosure, but it may take up to two years after foreclosure for such consideration. These types of loan will be high interest rate loans and so your monthly mortgage payment will be high. With every mortgage loan, you have to prove that you can afford the monthly payments. If your foreclosure entailed giving back the deed in lieu of foreclosure to the lender, your lender may agree to accept the deed and cancel the debt. This may allow you to get a new mortgage, but the interest rates are still going to be high. Hard-money lenders will give you about six months to get a mortgage loan with higher rates as well.
How do I begin repairing my credit after a foreclosure?
Answer: Repairing your credit should be your primary focus after foreclosure and to do so, you need to be careful of any spending (don't overspend) and pay your credit card bills on time as well as your utility bill. If you have to do a debt consolidation of your bills, it will serve to help you to better manage your credit and finances. Pay off as much debt as possible especially those that have the smallest balance first. Be sure to pay all your bills on time. Don't be late. Set a weekly or monthly budget goal and stick to it. This will create discipline in your spending habits.
What do I do if I have a second mortgage?
Answer: If the second mortgage lender begins the foreclosure proceedings, the first mortgage lender may buy out the second mortgage lender's interest in the property. The second mortgage lender could also bargain to purchase the first mortgage as well. This will only occur if the appraised value of the home exceeds the combination of both loan balances. At the foreclosure auction, the second mortgage lender would have to foreclose subject to the first mortgage and all property taxes. In order for someone to win the bid, they would have to satisfy both the first mortgage loan and the property taxes. It would be in your best interest to pay the second mortgage, if you can. If you haven't paid and the home is foreclosed, then the lender will report the debt on your credit report and still come after you to pay the debt.
What information do I need before I contact my lender?
Answer: Before you call the lender, make sure you have your social security number, loan number, date of your last mortgage payment, a date that you can agree to make payment, your mortgage loan balance and all other pertinent loan information. You also need to make sure that your name is on the loan. You should have all your financial details in front of you, just in case the lender needs additional information. You need to have a good enough reason and a solid one to explain why you haven't been paying your mortgage on time. The lender may need to know when you will get caught up with the loan and what you can afford to pay each month on any forbearance agreement.
When should I contact my lender?
Answer: You should contact the lender when you know that you will be late or will miss the first mortgage payment. Lenders are usually cooperative when they see that you are working with them. If you are thirty days late on your mortgage, the lender will have to report the missed payment to the credit bureau and that does not help you. A late payment will assess late fees and add to the current monthly mortgage payment. If you wait until after thirty days, then the lender will do whatever is possible to contact you. Don't try to ignore the lender's phone calls.
Do I need a lawyer?
Answer: You don't necessarily need a lawyer during the foreclosure process unless you want to do a short sale or you are going to file Chapter 13 bankruptcy to stop the foreclosure process. The lender usually has loss mitigation lawyers to handle any litigation during the foreclosure process. If you are seeking to stop the foreclosure process, a bankruptcy lawyer will give you a free consultation to see if this is the best route to take. If you are going to get a short sale done, you can seek a real estate lawyer to assist you instead of dealing directly with a real estate investor. There are no guarantees to the success of a short sale. If you think the mortgage company has made an error or mistake, then you will need a lawyer.
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