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How to Deal With Home Foreclosure

Posted: 09/05/2013 5:19 pm

When you find yourself buried under a pile of unpaid bills, relentless phone calls from collection agencies, disconnection notices, lack of food in the house to feed your children. Can it get any worse? Yes, you "just got served". You just received the Notice to Foreclose from the bank informing you that they filed a demand with the court to foreclose on your house. In such a desperate situation, will it not make the strongest of us tremble and weep?

First of all let me tell you that regardless of how you feel at the moment, losing your house in a foreclosure is not the end of the world; life will go on even if it must come to that. You and your family will not cease to exist because of it.

You know you are in deep financial trouble and must be wondering if there is anything that you can do to defend your house from an imminent foreclosure.

The very first thing that I encourage you to do is to assume the role of the adult in the family and take full responsibility for the situation whether it was your fault or not. Now more than ever your family needs you to take control of the situation, to encourage them and give them hope.

Now that you have assumed full responsibility of your financial situation, what are you going to do? Let me ask you another question, are you hiding or seeking? More specifically, are you hiding from the bank collection agent? Or are you seeking a solution to your problem? If you keep hiding and fail to confront this matter, you will never be able to find a solution. Why? Because you are simply not looking for a solution.

Let me ask you again, what are you going to do? Are you going to keep hiding or are you going to start seeking? If your answer is to start seeking then I may be able to help you.

The second thing that you must do is to make the unwavering decision to defend your house. Do not let the bank take away what belongs to you and your family. The simple act of making the decision to stand and fight for what is rightfully yours, will dramatically improve your chances of successfully defending your house. Your physiology, the way you feel and think will change. Now you are no longer running scared and hiding. Now you are taking a stand and ready to defend what belongs to you.

Now that you have made the unwavering decision to defend your house, let's get to work. What else must you do?

You must identify the cause of the problem, why can't you make the mortgage payments? Is it because you lost your job? Is it because you have lost your ability to earn an income? Or is it because you spent too much and you no longer can make the minimum payments? A wise man once said that "an identified problem is half solved" and I agree with that statement. When you identify the cause of your problem, you are half way there.

Grab a sheet of paper and write on top of the page "Problem" and under that heading write the cause of your problem. At this point in time it will be wise to create an income and expenses sheet to determine exactly how much your monthly deficit is and how much money is required to cover all your expenses.

Leave a few empty spaces and write another heading "Required." Under this heading write in bold letters exactly how much additional money you need to generate to become current with all your payments and to cover your monthly deficit.

Leave a few empty spaces and write another heading "Solution" here you will start to brainstorm possible solutions to your problem. In this section write every possible idea that comes to mind, now you are engaging your mind in the most effective way and since you are looking for a solution, you will surely find it.

Let's say that you need $5,000.00 to become current with all your payments, how are you going to get your hands on that kind of money? When was the last time that you looked at all the stuff that is stored in your garage or basement? Why not sell all that stuff you haven't used in the last 5 years on EBay or a garage sale? That stuff is worth money and someone will be willing to give you money for it. That is the fastest way I know to generate quick cash in a very short period of time.

What can you do about your monthly deficit? You must take a good hard look at you income and expense sheet in order to reduce or eliminate all unnecessary expenses, especially those little things that we fail to consider as expenses. Take a cup of coffee as an example, if you drink one cup of Starbucks coffee a day. That one cup of coffee is costing you $600.00 per year, are you willing to sacrifice a cup of coffee to save the roof over your head? What other little expenses can you eliminate? They all add up at the end of the month.

What else can you do? I know you do not want to hear this, but you need to call the bank collection agent and make an appointment to come to see him. I know that this is the very last thing that you want to do, but only the bank collection agent has the power to stop the foreclosure process and you need to talk to him. Keep in mind that the bank does not want to foreclose your property. However, they can and will foreclosure if you do not offer then them any other option.

What are you going to tell the bank collection agent? You must convince him that you are willing to do whatever you can to avoid losing your house and for that you need his help to work out a new arrangement that will be beneficial to both. You both have a common goal - you do not want to proceed with the foreclosure. To you it means losing the roof over your head and a ruined credit for several years, to the bank foreclosure represents tens of thousands of dollars in losses and having to report your property as a "NPA" (non performing asset) which affects them adversely.

You can defend your house from foreclosure. Make the decision to defend your house, create an affordable financial plan, present a financial alternative to the bank collection agent in a way that is beneficial to both of you and free yourself from the threat of a foreclosure.

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  • 10. SunTrust Banks Inc.

    Loans in foreclosure: 6,001 Avg. property value: $207,157 Pct. seriously underwater: 64% More than 6,000 loans serviced by SunTrust Banks Inc. (NYSE: STI) were in foreclosure as of February. Like most U.S. banks, SunTrust has been embroiled in controversy over its lending and foreclosure practices in recent years. SunTrust was one of five major lenders that in November agreed to pay a combined $162 million to settle complaints that it charged improper fees on home finance loans for veterans. Earlier in 2012, the bank agreed to pay $21 million to settle allegations that it overcharged more than 20,000 Hispanic and African American borrowers between 2005 and 2009. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 9. PNC Financial Group

    Loans in foreclosure: 8,545 Avg. property value: $185,306 Pct. seriously underwater: 55% PNC Financial Group Inc. (NYSE: PNC) serviced more than 8,500 loans in the foreclosure process as of last month. The average property value was just $185,306, one of the lowest of all banks, and the average debt on these mortgages was $202,286. Of the 8,545 loans in the foreclosure process, approximately 55% were considered seriously underwater. At the end of 2012, PNC was the 10th largest mortgage servicer in the country, with a portfolio size of $169.4 billion. PNC was recently required to pay $70 million in order to settle allegations of illegal foreclosure practices. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 8. HSBC Holdings

    Loans in foreclosure: 16,317 Avg. property value: $233,670 Pct. seriously underwater: 60% More than 16,000 loans serviced by HSBC Holdings PLC (NYSE: HBC) were in the foreclosure process as of February 2013. Six in 10 of these mortgages were considered seriously underwater. In January, the bank agreed to pay $249 million to settle complaints that it had wrongfully foreclosed on U.S. homeowners. Under the terms of the settlement, the bank paid out $96 million to 112,000 homeowners, while the remainder of the money went to reducing mortgage balances and forgiving outstanding principal on short sales, or selling a property for less than what is owed. Earlier this month, HSBC announced it was selling $3.2 billion worth of consumer loans to trim down U.S. operations <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 7. Citigroup

    Loans in foreclosure: 27,697 Avg. property value: $202,390 Pct. seriously underwater: 54% Citigroup Inc. (NYSE: C) serviced $6.3 billion in outstanding mortgage debt on homes in foreclosure, the seventh highest amount of all banks. Of homes in the foreclosure process, 54% were considered seriously underwater. While this figure is high, it was better than most of the nation’s largest banks. Citigroup is still fighting court battles regarding its mortgage practices as authorities accuse it of unfairly evicting people from their homes. These legal proceedings continue to hurt the company’s bottom-line. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 6. Bank of New York Mellon

    Loans in foreclosure: 31,821 Avg. property value: $236,703 Pct. seriously underwater: 67% At the end of 2012, Bank of New York Mellon Corp. (NYSE: BK) had $1.4 trillion under management and more than $26 trillion under custody. A core focus of the company’s business is its function as a custodian, tasked with safeguarding financial assets and handling various monetary and financial transactions. During the financial crisis, the Treasury Department named the bank as custodian for its bailout fund — meaning the bank provided record keeping and cash management for the fund. Although BNY Mellon is not a loan servicer responsible for executing the foreclosure process on delinquent loans, it is listed as the plaintiff or beneficiary in nearly 32,000 foreclosure proceedings nationwide, according to RealtyTrac data. The bank is listed because it acts as trustee on certain mortgage-backed securitizations, which are created when a large number of mortgage loans are pooled and placed in a trust. Foreclosure action related to properties held in the trust must be brought in the trustee’s name even though the trustee is not involved in the day-to-day foreclosure proceedings. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 5. Deutsche Bank

    Loans in foreclosure: 33,608 Avg. property value: $228,446 Pct. seriously underwater: 63% In January 2007, Deutsche Bank A.G. (NYSE: DB) bought home loan provider MortgageIT for $430 million. Soon after, the U.S. housing market collapsed. In May 2012, the bank agreed to pay the U.S. federal government more than $200 million to resolve charges that MortgageIT misrepresented the quality of mortgage loans it insured on behalf of the Federal Housing Administration. Three years ago, Deutsche Bank also paid the Federal Deposit Insurance Corporation $54 million to settle allegations against MortgageIT. While Deutsche Bank does not have a servicing arm, it acted as a trustee on more than 33,000 loans in the foreclosure process across the country, twice the number of any other non-U.S. bank.

  • 4. U.S. Bancorp

    Loans in foreclosure: 44,881 Avg. property value: $206,754 Pct. seriously underwater: 62% Nearly 45,000 loans serviced by U.S. Bancorp (NYSE: USB), with a cumulative property value of just under $9.3 billion, were in default as of February. About 28,000, or 62%, of all mortgages in foreclosure were considered seriously underwater. The bank was among the 10 financial institutions that agreed to pay $8.5 billion to settle allegations of widespread mortgage abuse in the foreclosure process, with U.S. Bancorp’s share of the payments totaling $80 million. The bank was the third-largest mortgage originator in 2012, lending $84.5 billion. This was up significantly from the $49.1 billion it lent in 2011. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 3. JPMorgan Chase

    Loans in foreclosure: 54,325 Avg. property value: $208,183 Pct. seriously underwater: 54% As of February 2013, J.P. Morgan Chase & Co. (NYSE: JPM) serviced nearly 55,000 mortgages that were in the foreclosure process, worth $11.4 billion. Fortunately for the bank, just 54% of those homes in foreclosure were considered seriously underwater, a significantly lower percentage than banks such as Bank of New York Mellon and Deutsche Bank. The bank was able to provide more loans in 2012 than it did in previous years. That year, the bank was responsible for 10% of all mortgage loans in the United States, worth $182.2 billion. This was up from the $146.7 billion the company had lent in 2011. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 2. Wells Fargo

    Loans in foreclosure: 84,903 Avg. property value: $205,550 Pct. seriously underwater: 56% Wells Fargo & Co. (NYSE: WFC) serviced $19.9 billion in total mortgage debt, a higher figure than any other bank except for Bank of America. Wells Fargo’s past lending practices received intense scrutiny in the past several years. The bank was one of the 10 servicers that participated in the $8.5 billion mortgage settlement announced in January. The bank was also required to pay $175 million in 2012 to settle accusations that it discriminated against African American and Hispanic customers between 2004 and 2009. Despite these troubles, Wells Fargo was the largest mortgage lender in the U.S. during 2012, originating 28% of all mortgages, worth $524 billion. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

  • 1. Bank of America

    Loans in foreclosure: 96,319 Avg. property value: $203,956 Pct. seriously underwater: 61% Bank of America Corp. (NYSE: BAC) serviced more loans for homes in foreclosure than any other bank in America as of February, at more than 96,000. In all, these properties had more than $23 billion in mortgage debt, and 60% of them were seriously underwater. The bank’s purchase of mortgage lender Countrywide Financial has been especially criticized. As of mid-2012, the acquisition was believed to have cost Bank of America over $40 billion. According to Mortgage Daily, the bank is taking a step back in both mortgage lending and servicing. In 2012, it cut the amount of mortgage loans it originated from $156.1 billion to $78.7 billion, while cutting its mortgage servicing operations by 21%. <a href="http://247wallst.com/2013/03/12/banks-foreclosing-on-the-most-homes/#ixzz2OIWRGmT8" target="_blank"> Read More At 24/7 Wall St. </a>

 
 
 

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