Colorado Foreclosure

Posted by admin on Nov 25, 2008

In the recent foreclosure report, Colorado is now the fifth overall of all states in foreclosure. The latest report showed that Colorado has 5,374 properties in foreclosure in September, or one in every 390 households. This is equivalent to a 23 percent increase from the previous month.

In the state of Colorado, the foreclosure process is quite different from other states. Colorado foreclosures occur through both in-court and out-of-court proceedings. The most common process is managed by a public trustee out of court and takes about six months.

The public trustee is either appointed by the governor or elected by the people in each county. When the lender files the needed documents in request for a sale of the property, this starts the out-of-court foreclosure process. The foreclosure sale can be scheduled after the public trustee officially records the foreclosure action.

The lender still has to obtain a separate court order that will allow the sale even after the sale is already scheduled. If no one contests that the borrower is in default, the sale could be allowed without a hearing after all concerned parties are notified.

The homeowner has 15 days to stop the foreclosure from taking effect. This is done by submitting a letter of intent to the public trustee stating his plan to pay off the default. The deadline for this to be done is noon the day before the foreclosure.

After about 110-125 days after the recording of the initial foreclosure action, the public trustee schedules the sale. Within 12 weeks the notice of sale is published in a local newspaper and a copy of the notice shall be sent to the borrower.

Given the chance that a homeowner has before the foreclosure take effect, many defaulted homeowners had been able to save their properties from foreclosure using different foreclosure workouts. The most commonly preferred method is a loan modification where the homeowner requests the lender to modify the loan terms on their existing loan to make it more affordable.

With the recent increase in the foreclosure rate in Colorado, lenders are now more interested in cooperating with the borrowers requesting for loan modification agreements. Making the loan more affordable for the borrower gives them a better chance of collecting payments rather than foreclosing on the property. Aside from being an expensive process as outlined above, foreclosure puts the lender on a losing side since real estate prices are low and buyers are scarce.

California Loan Modification

Posted by admin on Nov 24, 2008

The State of California holds the number one spot for the highest number of foreclosed properties.  In an effort to stop this trend, the government of California now requires banks and other lending institutions to contact delinquent homeowners 30 days prior to filing Notice of Delinquency to make loan modification mandatory.

California Civil Code 2923.6 which was enacted last July 2008, requires Lenders of residential loans in the State of California to accept loan modifications in most foreclosure situations. This applies to all residential loans made from January 1, 2003, to December 31, 2007. Loan-modification solutions can include freezing or reducing interest rates, reducing the principal or extending the term of the loan.

Analysts have agreed that this move on the part of the state government is a far more superior program to combat foreclosure as compared to the federal bailout funding. In this program, the spending of taxpayer’s money by the government was eradicated while controlling the situation. Cooperation is promoted among the borrowers and lenders to seek solutions in order to promote mutual interests.

With this program, both the government and the public are expecting a drop in the number of foreclosure proceedings in the coming months and years. This long-term solution may take a while to feel its effect but it is viewed to be more effective in solving the problem as it addresses the root cause, providing homeowners with more affordable payment options instead of giving them additional loans.

What Californians need now is a thorough knowledge regarding this all important law. This law, however, does not mean that a homeowner has to be behind in his payments before they can ask their lender to modify their loan. Homeowners who are up-to-date in their mortgage payments can contact their lenders and propose loan modification agreements.

There are available loan modification experts who are willing to help distressed California homeowners in having their loans modified. They can give professional guidance and counseling to reduce undue anxieties and risks in regards to their mortgages. Most of these experts come from loss mitigation companies that can also offer legal remedies from their in-house lawyers to make sure that a homeowner’s rights are defended to the best of their interests. They require some reasonable fees for their services.

However, homeowners are also cautioned to trust only reputable loss mitigation companies. With the current real estate market situation and the enforcement of the new law, there are also increased number of scams and frauds reported associated with loan modifications. Therefore, it is always best to examine each company’s profile.

How to Slash Your Interest Rate While Converting Your Adjustable Rate to a Fixed Rate and Lower Your Payments

Posted by admin on Nov 24, 2008

Due to the housing boom over the past few years, many Americans have taken advantage of low interest rate mortgages.  Most of those same people hoped for even lower interest rates, which lured them pursuing adjustable-rate mortgages.  During the times when interest rates were low, those who were under an adjustable-rate mortgage had a significant advantage to those who were not.  Low interest rates prevailing in the market means lower payments for them in their monthly mortgages.

But as we all know, things did not happen as expected.  Today, interest rates are steadily rising.  With the present financial crisis sweeping the globe, there are no signs of interest rates decreasing in the coming months or even years.  Homeowners with adjustable-rate mortgages are now experiencing a steady rise in their monthly payments as well as a steady decrease in home value.

What is even worse is when negative amortization occurs.  The process of negative amortization takes place because adjustable-rate mortgages have caps that limit the mortgage amount within a specific time period.  But when this limit is not sufficient to cover the increased interest, the unpaid balance is being added back onto the loan which in-turn gains more interest.  So, even if the homeowner is paying on-time, his mortgage balance is increasing instead of decreasing.  This could result in the homeowner owing his lender more than he originally borrowed.

If you are one of these homeowners with an adjustable-rate mortgage, the only way you can survive your loan is to convert it into fixed rate mortgage.  Once your debt is reduced to a fixed rate, your monthly payment remains constant until the end of your mortgage term and you will not have to worry about fluctuations and increases in your interest rate.  Having a fixed payment allows you to be in control of your budget and have a solid financial plan, instead of being at the mercy of the market.

But you could do even more than simply ask for a steady interest rate.  You could actually slash a significant amount of money off of your monthly payment.  A negotiation with your lender could result in a remarkably lower interest rate than you could possible imagine.  This could be quite a daunting task for an individual homeowner like your self to take on so it would be in your best interest to seek the assistance of a reputable expert in loan servicing or loss mitigation to handle the process for you.  All you have to do is carefully select a competent loan servicing or loss mitigation firm to handle the process of a loan modification so you can finally relax and sleep at night.

How to Slash a Huge Chunk Off Of Your Loan Balance

Posted by admin on Nov 22, 2008

With the economy as shaky as it is, everyone is in search of new ways to reduce the financial burdens of daily living.  One of the greatest concerns among average Americans is their mortgage payments.  The interest alone eats up a great big chunk of the family budget.

The good news is, despite our current economic situation, you, as a homeowner, have available options to significantly reduce your loan balance.  In fact, an unfavorable economy could be favorable to you if you possess the right knowledge on how to reduce your mortgage loan balance.

One of the most effective ways of doing this is through the negotiations of a loan modification service or loss mitigation service and your lender.  Third party negotiation is a proven way for you to slash a huge chunk off of your mortgage balance.  Most of the time, it turns out to be a huge reduction and you will most likely become the subject of envy in your neighborhood.

As much as you want to retain possession of your dream house and you are searching for ways to do that, your lender is also desperate to maintain you as a client.  Remember, this has something to do with the economy.  With the current financial crisis, more and more homes are being foreclosed on, yet buyers are becoming scarce, reducing the value of properties.

This is a situation where cooperation is more than welcome and lenders are more than willing to work with their borrowers so they can continue to pay for their loans.  Even if you are up to date with your payments, the present economic condition could be reason enough to negotiate a loan modification to reduce your monthly mortgage payment until the end of its term.

What could you negotiate for?  You could ask for a reduction of interest, reduction of the principal amount, a shorter paying period, combinations of these options, or even forgiving the remaining balance altogether.

This could be a very tricky task, however, that only a few would dare to partake in, especially knowing that you will be dealing with large institutions like banks and other financial giants.  With the help of a reliable loan modification expert, this is absolutely possible, even beyond your wildest imagination.

Loan Modification in California

Posted by admin on Nov 21, 2008

While the nationwide foreclosure rate continues to increase, California numbers are dropping. Thanks to the new foreclosure law enforced last September.

This law requires all banks and lenders to offer loan modification to delinquent homeowners. This gives these homeowners a chance to avert foreclosures before they could be served.

According to the data released by Foreclosure Radar, as early as September, the number of notices of default has decreased by as much as 61.8 percent and the number of homes put up for sale by auction also dropped by 47.3%. In actual figures, this is equivalent to 16,352 notices of default in September which is significantly lower than Augusts’ 42,790 filings.

These dropping figures continued to the next month. Data for October showed that California foreclosure rate is lower by 18 percent compared to that of September. The public and the state government are hopeful that this decrease will continue until the next year.

This drop in foreclosure rate can be directly attributed in the enforcement of the new law. Although loan modification has been around for years, few homeowners are even aware of this option. This California law brought widespread awareness to the homeowners.

Though this law and loan modification does not guarantee to be a “cure-all” solution to the current mortgage crisis, it is certainly an alternative to be considered. If the drop in foreclosure rates in California continues, then this can serve as a national model that can be followed by other states or even other countries. This could also mean that loan modification is a superior option in stopping foreclosure.