The foreclosure crisis still continues to affect millions of
homeowners today with no end in sight. It is expected that there will be
another 4.5 million foreclosure filings processed in 2010.
Don’t Believe The Hype-Current Government Foreclosure Prevention Programs Will NOT Help Most Homeowners In Default
The
US government has tried to remedy this crisis by passing bills to help
curve the foreclosure crisis across the nation. They even started
allocating funds to buy and fix up foreclosed homes, urging lenders to
offer loan modifications and guaranteeing the loans in case they go back
into default. However, the bills that have been passed have only helped
very few homeowners in default or in foreclosure. And the vast majority
of the loan modifications that were processed really did not offer much
support since most of the loan modifications that were processed did
not reduce the monthly mortgage payments enough to make them affordable
and in many cases increased the monthly mortgage payment thus making it
even less affordable.
The truth is because there are so many
people trying to work out a loan modification lenders just do not have
the manpower to process all of the requests. Another reason is that many
lenders have their hands tied because they have to answer to their
investors and many investors are not willing to take a cut on their
returns to grant a loan modification. Consider also that to date only a
measly 1% of the 4 million homes targeted under the government
foreclosure prevention plan have the loan permanently modified.
Add
the fact that these programs require that the homeowners in default
still have a job. However, the unemployment rate is currently at 17.2%
and continues to rise. As a result, less the half of the 3.2 million
homeowners who are in default are actually eligible for any relief from
the government-sponsored programs.
So reality is that while it may
be perceived that there are many options, there are really not a whole
lot of options to effectively prevent foreclosures. There are just too
many foreclosures out there for all of them to be handled effectively
and the program that are in place do not address the recent economic
downturn.
The only way to ensure that homeowners can protect
themselves from foreclosure especially wrongful foreclosure is to become
more proactive and educated about the foreclosure process. Then use
that knowledge to their advantage. In fact, it is essential for any
homeowners in default to become more proactive to stop foreclosure
themselves.
The Dirty Truth About The Mortgage Business
You
see, back before when the real estate market was booming and record
numbers of mortgages were processed as a result of the booming economy
there were also huge amounts of mortgage portfolios that were packaged
and resold to what is known as the secondary market. This was common
practice for mortgage loan companies and banks to do this so that they
could free up money to do more loans. They were extremely greedy, very
greedy.
Here is the thing; a vast majority of those loan
portfolios were sold off without proper documentation. Many of these
portfolios were sold many times and sometimes even owned at the same
time by different holders. Also, many mortgage lenders, banks and
servicers are now out of business. Therefore many lenders do not have or
can show proper documentation to prove true ownership of the mortgage
note. So it is highly likely many foreclosures that are being conducted
today are done so without proper due course. As a matter of fact,
several major banks have faced and lost class action suits because they
conducted their foreclosures in this manner.
The key to fighting
foreclosure is learning how to identify wrongful actions taken by the
lenders, plan a foreclosure defense and stop foreclosure yourself. Sadly
though, thousands upon thousands of lenders still conduct wrongful
foreclosures.
How Is This Possible?
Quite simply many
homeowners do not know that they have the right to contest their
foreclosures and do not answer the foreclosure notice. As a result,
their homes are foreclosed or I should say stolen from them. Think about
it. If someone you don’t know came to you and said hey, you own me
$5,000 pay me now, wouldn’t YOU want some type of proof that you owed
him or her? I know I would. It is the same thing here when “ANY” bank or
mortgage servicer representing the mortgage lender that issues a
foreclosure notice. The bank is basically saying “Hey you owe me X
amount of dollars so pay me now or I plan to foreclose and take your
home.” There is nothing in a foreclosure notice to prove that your
lender has the right to foreclosure.
After all, there is no copy
of the assignment of the note or anything else for that matter showing
that they rightfully own the note to collect the debt in due course. The
lender is so certain that you will accept the fact that you are in
foreclosure and won’t challenge their rights to foreclose on your home.
After all if you hadn’t made any payments in at least three month they
really can come take the house, right? Wrong!
What many homeowners
are failing to realize is that even though they may be are late on
their mortgage payments whenever the lender issues a foreclosure notice
does not mean they have the legal right to foreclose. But they will
foreclose only if the homeowner does not contest the foreclosure
regardless if they have legal right to foreclosure or not. It is up to
homeowners to take action immediately once a foreclosure notice is
issued.
In closing, if you are at risk of foreclosure or know
someone who is do some investigating and find out if your lender
actually does have the right to foreclosure. You just might find out
that your lender is trying to pull a fast one on you.
If you would
like to learn more on how you can protect yourself against wrongful
foreclosure get a copy of The Ransom Fight Foreclosure Quick Guide.