Prevent Phoenix, Gilbert, Chandler & Mesa Foreclosures
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A significant number of Arizona homeowners find themselves in the impossible position of not being able to make their monthly house payments - often due to job loss, divorce, illness and recent huge subprime loan interest rate adjustments.
PHANTOM TAX from MORTGAGE DEBT FORGIVENESS: Before October 2007, distressed homeowners, who lost their home through Foreclosure or were forced to sell their home for a sales price below an amount needed to repay their mortgage and pay closing costs, had to pay income tax on the amount of their mortgage debt forgiveness. WHAT TO DO: Here are some options that lenders can use to help you catch up on your mortgage payments. While all these choices apply to mortgages insured by the U.S. Department of Housing and Urban Development/Federal Housing Administration, most are worth at least asking a conventional lender about. SPECIAL FORBEARANCE: Your lender may be able to arrange a repayment plan based on your new financial situation and may even provide for a temporary reduction or suspension of your mortgage payments. You may qualify for this if you've recently had a reduction in income or an increase in living expenses. But you'll have to furnish information to your lender to show that you would be able to meet the requirements of the new payment plan. LOAN MODIFICATION: You may be able to refinance the debt or extend the term of your mortgage. This may help you catch up by reducing the monthly payments to a more affordable level. PARTIAL CLAIM: If your loan is insured by the FHA, your lender may be able to work with you to obtain a one-time payment from the FHA insurance fund to bring your mortgage current. You may qualify if your loan is at least four months delinquent but no more than 12 months late and you're able to begin making full mortgage payments. PRE-FORECLOSURE OR SHORT SALE: This will allow you to avoid foreclosure by selling your property for an amount less than the amount necessary to pay off your mortgage loan. You may qualify if the loan is at least two months delinquent, you're able to sell your house within three to five months, and a new appraisal shows that the value of your home meets HUD program guidelines. DEED IN LIEU OF FORECLOSURE: As a last resort, the lender may be willing to take back your home and sell it. That won't save your home, but it wouldn't be as damaging to your credit rating as a foreclosure. OTHER RESOURCES: Homeowners should contact a HUD-approved housing counseling agency. You can find the one nearest you by calling toll-free 1-800-569-4287. The agencies have information on services and programs offered by government agencies, as well as private and community organizations that can help. The services are usually free. HUD's Web site -- http://www.hud.gov/foreclosure/index.cfm -- has information on how to avoid foreclosure. WHAT NOT TO DO: It is your problem and no one cares more about you and your situation than you do. Stay involved - even if you have hired help - and protect yourself. If you're having difficulty paying your mortgage, don't let scam artists capitalize on your distress. The most prevalent scheme is what's called "equity skimming." A "buyer" approaches you, offering to bail you out of financial trouble by promising to pay off your mortgage or give you an amount of money when the property is sold. The foreclosure rescue scams come in three types: PHANTOM HELP: Beware of scammers preying on you when you need information and help the most! This U.S. Treasury Mortgage Scams Consumer Advisory will help you identify those who are there to help you and who are not. The "rescuer" charges outrageous fees either for phone calls and paperwork the homeowner could have easily performed, or on a promise of better representation that never occurs. The homeowner is usually left without enough assistance to actually save the home but with little or no time left to prevent this grievous loss by the time she or he realizes it. BAILOUT: This scenario includes various schemes under which a homeowner surrenders title to the house, believing that he or she will be able to rent the home and buy it back in the next few years. Scam artists sometimes tell the homeowner that giving up the title is necessary so that someone with a better credit rating can get new financing to prevent foreclosure. However, the terms of those deals are so onerous that a buyback becomes impossible. BAIT-AND-SWITCH: This is where a homeowner doesn't realize that he or she is surrendering ownership of the home. Many homeowners later insist that they believed they were only signing documents for a new loan to make the mortgage current. Many also say they had made it quite clear they had no intention of selling or giving up their home to anyone. Common Real Estate Terms My Phoenix Home Seller Sales Guide has other seller tips and additional resources available to assist you with your home sale.
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