Tag Archives: loan modification

Property Taxes, Insurance, HOA Fees, and also Foreclosure

When homes go into foreclosure, the owners are generally far more worried about the mortgage payment than something else. You will find several costs involved with owning a residence, though, and all of these need to become paid just before and through the foreclosure. If they are not paid, as well as the homeowners are in a position to stop foreclosure prior to losing the residence, they can quickly uncover themselves back in the similar circumstance, in danger of getting sued again for delinquent property taxes, homeowners association fees, or discover themselves owning an uninsured house. Even worse, the lender may impose an escrow account or forced insurance on the property. Thus, it can be important for foreclosure victims to keep on top of as many of the payments relating to the residence as they can.

The county and city property taxes work slightly differently from the other charges mentioned above, because of their greater priority in the foreclosure proceedings, but they, along with any other liens on the property, will probably be wiped off immediately after the sheriff sale of the residence. When the sheriff sale is conducted, the property will probably be sold for whatever the highest bid amount is. These proceeds is going to be used to pay off every thing that is affecting the residence. First to be paid is any delinquent or currently due property taxes. The county gets paid first if the homeowners do not postpone the sheriff sale or function out a remedy to prevent foreclosure.

If the foreclosure victims can not save their home, there might be a possibility of delinquent taxes becoming added as a lien on the property before the foreclosure. The lender will make an effort to stop this, as they will want as significantly of their dollars as feasible without a tax lien, which will involve the expenses for acquiring the lien, as well as the taxes themselves. Nevertheless, this possibility depends on how the property tax is being paid, whether or not via escrow using the mortgage business, or if the homeowners are paying it on their own.

If property taxes are paid via the escrow account, then the lender will pay the property taxes as they come due. Not surprisingly, the amounts paid for taxes will be added to the total payoff necessary to sell the residence or refinance to stop foreclosure, but the taxes will likely be paid to the county on time. The bank won’t let the house go into a property tax foreclosure though they are pursuing their own foreclosure, and this gives them the chance to add more interest and charges to the total payoff, as they can stack up far more junk fees on a negative escrow balance.

If the homeowners are paying the taxes on their own, although, and they get behind, then the proceeds from the sheriff sale will probably be used to pay off the property taxes. When the sheriff sale is conducted, the sale price will probably be used to pay the taxes first, then the mortgage, then any second mortgage as well as other liens. But the property taxes might be paid, so as to stop the county from taking possession of the residence. The possibility of the county acquiring a lien on the house could possibly be smaller, however it is typically adequate for the bank to impose an escrow account on the homeowners. They merely spend the delinquent taxes and add that amount to the total payoff, in addition to associated charges and interest, which drives up the amount necessary to reinstate the loan or steer clear of foreclosure fully. The homeowners could not even know they are now paying additional every month to help keep up a new escrow balance, until they have saved the property and are now creating typical payments once again — it can be just that the payments could be much greater than they originally were because of the imposed escrow payment.

Immediately after the property taxes are paid off through the sheriff sale, the very first mortgage will be paid off with as much of the proceeds as are left. If there’s not sufficient to spend the first mortgage completely, then the Homeowners Association (HOA) as well as other lienholders will just get absolutely nothing.

Now, the HOA could try and sue the homeowners soon after the foreclosure for the amount of fees that had been owed up to the date that they were no longer the owner of the residence. It might not be worth the time or effort for them to attempt to sue and obtain a judgment, although, specially as it’s typically known that most foreclosure victims don’t have the extra resources to pay a deficiency judgment and little motivation to work out a payment plan or other arrangements. It’s much more likely the HOA will just quit on collecting the fees, as they will not be able to cover the costs in the lawsuit.

Hazard insurance, the last in the costs most frequently related using the mortgage payment, is generally paid with the mortgage in the escrow or monthly payment. If that is not being paid, or the owners are responsible for paying the insurance on their own, there will be no lien placed on the property for it; the property just doesn’t have hazard insurance. If something occurs to the home even though the insurance is not paid, the insurance will not cover it, definitely. This really is an additional charge that the bank can impose on the property, if they know that the foreclosure victims aren’t taking care of it. Mortgage organizations undoubtedly do not want to loan money on a house that, if it is destroyed, will likely be a total loss to them; insurance is most generally mandatory for obtaining a loan in the first place.

The longer the foreclosure goes on, the greater costs will climb as well as the a lot more hard it is going to be for homeowners to solve the crisis and avoid foreclosure. Various expenditures will still need to be kept on time, such as the property taxes, homeowners association fees, and hazard insurance, or else the danger of future foreclosures will probably be present, or the lender could impose a forced, costly escrow account to ensure they’re paid. Added liens could possibly be placed on the title, along with the homeowners could be sued soon after foreclosure or discover that their insurance has lapsed and won’t cover any damages that happen to the property. Therefore, homeowners may well find that they are fighting foreclosure on numerous fronts at when, but they want to be conscious of all the possibilities of letting their housing payments go into default. Foreclosure is obviously probably the most pressing concern, however it may be all of the small charges that trigger them to lose their houses, unless they acquire adequate foreclosure info to understand the whole process and what’s really at stake.


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What To Do If You Get Scammed From A Loan Modification

For the most part everyone knows by now, the numbers of homeowners struggling with foreclosure that are increasing. Countless homeowners are having trouble making their mortgage payments and are a missed payment or two away from a notice of default.  True they will be having to deal with how to fix bad credit and in the future how to get credit score back up.  But until that time you don’t want to be scammed if you are trying to save your home many of the homes in Santa Maria are for sale are either a short sale or even a foreclosure.   The reality is that the Santa Maria real estate market here in Santa Maria, California has been hit hard with values falling to over 50% of what their values were in the peak.

Many people will investigate any alternative to try and spare their house from foreclosure. This opens the door to scammers. The fact is, mortgage modification and foreclosure relief scams are popping up everywhere you go. As a homeowner you’ll want to know that they are out there and what to look for in order to steer clear of them. A scammer cannot only cost you money but can cost you vital time that you could use to save your house or get ready to move. You need dependable information on foreclosure or the short sale procedure in a timely manner.

Nearly all the ads you’ll notice will claim to help you save your home from foreclosure or lessen your house payment to an easily affordable level. Additionally they infer that they are associated with a government program or enjoy a direct line to your loan company. They don’t.  Certainly, there are honest businesses around that legitimately make an effort to aid homeowners yet, sadly, there is a high number that are simply scams.

Scammers are simple enough to spot simply because they generally ask for money up front. But, they’ve got other sorts of strategies as well. Look for these clues:

1. Someone who demands money at the start before they actually do anything. Many states have recently passed laws regulating money paid in advance for mortgage modification or foreclosure services. The most effective rule of thumb should be to not pay for anything in advance.

2. The scammers have ways of tracking down property owners who have missed payments or have their properties scheduled for auction. They then target these house owners knowing that they are more susceptible since they will be in a troubled situation. When you are one of these homeowners be extra vigilant in any dealings you may have with foreclosure rescue or mortgage modification companies.

3. Some scammers attempt to get you to sign the deed to your house over to them claiming they are going to make the payment on your property. They will not.

4. You should not make a mortgage payment to any person besides your lender. More than likely, you will not see that money again and neither will your lender.

5. Be aware of the phrasing of certain promotions that make it sound like they work directly with a government bailout program. They almost certainly do not. They more than likely would just like to make you another high fee, high interest consolidation loan which will only buy you a little time at great cost.

6. Getting a letter from a real estate agent offering you free services to do a loan modification.  Unless they are a govt sponsored consumer group they do not receive any funding so what is the motive to offer you this service for free? That truly involves lots of paperwork as well as time on the phone?  Well its to eventually get you to sell the home on a short sale so that they can earn a commission on selling your home but not necessarily help you get the loan modification as you may have been hoping for.

Ok, so what if you’ve recently been scammed? Well, you possibly can report the issue to the Federal Trade Commission (FTC). They have a web based complaint assistant and have a hotline at 1-877-FTC-HELP. You can also uncover good information regarding foreclosure or short sale consequences online.  There are many benefits to doing a short sale as well but you will have to read about that on my other blogs.  One thing to keep in mind regardless of what you plan on doing is that the Mortgage Debt Forgiveness Act of 2007 expires in 2012 and there will be tax consequences that will occur after that.   Please seek some legal counsel as well as some tax council as to what you want to do next year if you feel that maybe you will not qualify for a loan modification to avoid some serious tax consequences from the I.R.S.

There is also the NeighborWorks America group that educates the general public about loan modification scams. The best way to avoid these scams would be to educate yourself on the many varieties of scams and be very cautious about any individual offering to help modify your loan or save your house from foreclosure.

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Will You Get Sued If Your Home Goes To Foreclosure?

If you own far more than one home and are facing foreclosure, you might be most likely worried concerning the bank going after your second property if you are unable to save the very first. Bank representatives and armchair foreclosure experts will threaten you with being sued again and losing your other house, having your other assets repossessed, and maybe even having your bank or retirement accounts stolen or wages garnished. Fortunately, however, a lot of of these predictions will in no way turn into reality.

The concern of foreclosure does need to be taken seriously, though, and discovering out your possibilities must be the first consideration. The very first thing you need to do is contemplate several other solutions rather than just letting a house go by way of the foreclosure process. Attempt and get as much time as you may from the bank, even if a sheriff sale is coming up; the bank can postpone any foreclosure proceedings within the local courts or cancel an auction to give you additional time to work on a remedy.

You may would like to think about trying to list your house for sale, even when you have to do it with a brief sale and convince the bank to take less than the total amount you owe on the loan. Otherwise, if there is certainly definitely no technique to save the household along with the lender is unwilling to do a brief sale, you can offer the bank a deed in lieu of foreclosure, which will, upon the bank’s acceptance of the supply, stop foreclosure and permit you to give the home back towards the bank instead of going through the whole legal process and seeing your residence auctioned off by the county.

But if the home does go into foreclosure and you do lose it to a sheriff sale, this does not mean the bank can go after your other house or any other assets you still possess. Several diverse requirements need to be met for a bank to try and sue you once more after the foreclosure. Most of these requirements are easy to meet, but the last one usually guarantees that the bank won’t take the time to pursue a different lawsuit to go after your other personal items or extra properties.

First, the residence has to sell at the county auction for much less than the total quantity owed on the loan in the time of the sheriff sale. This is generally fairly straightforward to meet, given that the bank will have added thousands of dollars in fees so that nobody in their proper mind (not even the bank) would pay that much for the house. Generally, it truly is the foreclosing bank that places the only bid on the property, and they bid the minimum amount, so the house is likely to sell for far much less than the total amount owed. The bank will end up with the property along with a handy write-off for the lost portion of the debt.

Second, your state has to enable deficiency judgments inside the case of foreclosure. Not all states allow this in their foreclosure laws, so make certain you appear up your law and find out if they are able to sue you and below what circumstances. Even if the lender is allowed to pursue one more lawsuit, the kind of foreclosure utilized, regardless of whether judicial or nonjudicial, can also be a determining factor in how difficult it is going to be to begin the lawsuit and how it ought to be pursued.

Finally, you really have to have something of value that the bank would want, commonly some extremely liquid asset the bank can easily seize. That does not mean having an additional house, to be clear. If the bank got absolutely nothing back from you on this foreclosure, what makes you feel it would be worth their time to go right after your other residence? Would they get anything for their time and funds, or would they most most likely just get stuck with losing much more cash when the household sells for too small at an auction to pay off even the existing mortgages, let alone a deficiency judgment?

So, possibly the bank could go right after your other house soon after you lose one. But, in practical terms, banks nearly in no way do this, because it just isn’t worth their time. It costs them a lot more to hire attorneys to sue you for the original foreclosure, then sue again immediately after that for a deficiency judgment, then sue you once again for foreclosure on your other house due to nonpayment of the deficiency judgment. And in the finish, they will most likely still end up with nothing to compensate them for their total expenses.

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Banks Are Still Part Of The Foreclosure Mess

Foreclosures have been a nationwide epidemic that can have an effect on each and every and each one of us before it ends not just the homes in Santa Maria in the Santa Maria real estate market.  The only solution to this problem is for everybody to pitch in and fix the issue before it is out of control. Numerous of the lenders and servicing firms have taken measures to ease their very own suffering, but it seems most would rather delay things, than actually fix them. Maybe they are under the assumption that the homeowner will come up with their very own remedy if they give them enough time. This just just isn’t the case; it can be the American way to procrastinate, so don’t expect foreclosure victims to act any unique.

I personally aid 100’s of people save their house every year and I know for a truth that 90% wait till the absolute last minute just before they seriously try to quit the foreclosure. Most just do research online and speak to organizations who may be able to assist, but they do not take action until they’re weeks, or days away from losing their residence. Naturally, the servicing corporations do not assist significantly, since they do not even give assistance till someone is 3 payments behind. They had been not ready for this either; they are so overwhelmed with men and women in foreclosure, that they don’t have time for those that are still months away. It truly is too poor, too, simply because for many of these people, a straightforward refinance into a fixed rate loan would solve the problem.

Lenders and servicing companies have to be more proactive and offer you solutions before it can be too late. If a homeowner can not make payments at 10%, but they are able to at 8%, then why would the lender not desire to supply a fixed rate refinance or modification into a much more cost-effective rate? Rather, they are opting to lose 20-30% on a mortgage that could have quickly been profitable. Lenders can make a easy change in their method and eradicate quite a few of these foreclosures just before they occur. Homeowners should make changes also. Certainly it truly is simple to blame lenders for these problems, but most homeowners knew what they had been receiving into and just created poor spending decisions. Shoppers have to be educated on the mortgages and they need to be made aware of how effortlessly a hardship or depreciation can cause a foreclosure. Spending habits need to be adjusted and homeowners ought to be far more conscious of what’s happening with their credit.

By continuing to foreclose on properties, instead of offering solutions, lenders are forcing lower credit scores and taking an increasing number of borrowers out of the marketplace for new properties and mortgages. This not merely affects our actual estate market, it affects our overall economy by removing millions of customers from the retail market. Numerous mortgage brokers or real estate agents require new jobs and other people are just barely scraping by. Not to mention all the foreclosure victims who are no longer creditworthy. Undoubtedly this does open up new revenue streams for other enterprise that profit from these hardships, but overall, I feel we can all agree that society is significantly greater off with out foreclosure.

I’ve noticed many customers who use their life savings attempting to pay the mortgage on a home they can no longer afford, since of an adjustable rate mortgage. In the past these homes could just be sold as well as the owners could walk away, but now they’re upside down from a 100% mortgage plus a industry that appears to be obtaining worse every day. Our company is usually effective helping victims refinance or sell, but we also function with lenders to assist them establish a loan modification or workout plan to preserve them in the existing loan. Once we get involved, lenders are very cooperative, but only a tiny portion of foreclosure victims basically find us before it’s too late. Lenders and servicing organizations ought to work with their clients without the require for professionals to get involved. Sadly, these lenders are suffering, too, so they are forced to hire low expense client service reps that are overworked and underpaid.

This creates a whole new difficulty; the client service rep will not care if the loan is profitable or not. They only wish to make it through the day and eliminate as several circumstances as probable, with the least quantity of function. They seem to love it when we get in touch with them on behalf of a client, mainly because they know we are going to do most of their work for them. Maybe this really is why we are so successful, but still, homeowners must not be forced to employ a person to speak with their lender on their behalf.

If you’re a homeowner facing foreclosure, then I suggest contacting your lender first and discovering out what choices they’ve obtainable. If they’re not helpful, or do not provide any viable solutions, then you will need to instantly contact a specialist who can enable you to either discover a brand new lender or make arrangements along with your existing lender to start a loan modification. Corporations like mine, who give all of these services from one source are your greatest selections, since you will not be “sold” on one solution, you will be evaluated and provided with all possible options to stop foreclosure. Ultimately, you need to find a corporation or individual that has expertise and is somebody you can trust, so really feel no cost to interview companies till you discover somebody who fits your exact desires. Just be careful, mainly because quite a few of the companies offering foreclosure aid do not have knowledge and must not be trusted.

Last but not least if you find that you cannot get a loan modification and stop the foreclosure process then consider doing a short sale.   There are many benefits to doing a short sale some of them I have outlined in previous posts.

Eventually, lenders and servicers will determine that it truly is more profitable to supply viable solutions, but for now, if you are a homeowner, you greater plan on helping your self out of foreclosure or finding a person to complete it for you.

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The Eviction Process: Notices, Hearings, and the Sheriff

For homeowners facing the loss of their properties to foreclosure, the anxiety never seems to end. Soon after months of becoming threatened by the lender’s “customer service” department with becoming evicted, sued, and having their wages garnished, even the final foreclosure and sheriff sale doesn’t end the complications. The time in between the county auction plus the eviction by the sheriff can be probably the most stressful times of the foreclosure process.

This really is simply because, even after finding out they are unable to put together a realistic strategy to save their home and stop foreclosure, homeowners have to then begin planning to leave their home. But they don’t know, in most circumstances, even how much time they have to move out, when the sheriff will show up to throw them out, or if there is anything they are able to do to obtain more time.

In nearly all foreclosure circumstances exactly where and when the sheriff or trustee sale takes place will be posted and you will be notified as well.  Homeowners really should obtain a notice from the county sheriff’s department at least a couple of days before the scheduled eviction. This is a rule in virtually each state and county, and is just notice to inform the former homeowners of how much time they have left to remain within the residence.

You will find various other approaches for homeowners to find out how much time they have just before the eviction, other than trusting in an individual from the sheriff’s office to come and post a notice on the door. Also, notices may be blown off by the wind, taken off by nosy neighbors, or dropped in some place where the foreclosure victims aren’t most likely to search for a notice.

To keep away from getting blindsided by the possibility of getting evicted with no warning, homeowners ought to know the exact date when the county foreclosure auction took place. Knowing that may give them a superb notion of when their ownership interest inside the property was transferred to the high bidder at the auction.  One of the best and easiest ways is to just call your mortgage company and just find out.

Then, they can look up the state foreclosure laws to decide how much time they are going to need to remain in the house soon after the sheriff sale. Some states permit under the law for a redemption period exactly where the foreclosure victims are given a lot more time even soon after the sale so that you can pay back the amount they owed on the house.  Homeowners could move out prematurely, eliminating a important protection and opportunity to begin receiving their finances back on track, since most banks will offer cash for keys or now known as relocation assistance.

Redemption periods differ widely by state, with some having just a few weeks to other people having as much as a year following the foreclosure auction. Needless to say, other states do not have a redemption period at all, or they’ve it before the sheriff sale. Once again, this really is why it’s essential to look up the state laws, so foreclosure victims do not move out the property too soon or too late.  A judge can grant the foreclosure victims some additional days or weeks to acquire a new apartment and begin moving out of their former home. Just several days can mean the distinction among settling any last aspects of a brand new lease and moving out, or having to put items in storage and move in with a friend of family members member for several days.  In a perfect world, homeowners will likely be given numerous notices of an impending eviction hearing and also the eviction itself, but you should take it upon yourself to know your situation.


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