Definition: Paying off an existing loan with the proceeds from a new loan, usually of the same size, and using the same property as collateral.

I don’t believe that refinancing your home is always in your best interest. Sometimes, once your financial situation is examined in both the short and long term it may be the worst thing you could do at this particular time. However, sometimes, refinancing your home is the best move you can make providing you have the income to support the new payment. This option is only available to you if your current loan does not exceed the value of your house. If the loan is higher than value, regular refinancing is not an option. However some lenders have been willing to refinance for the value of the house and offer a different type of loan for the balance, following different terms for this portion of loan. Ask your mortgage lender if this option is available to you.

WARNING:
You’ve probably received letters from mortgage brokers and lenders saying you are already pre-approved for a new mortgage. The fact is that it is very difficult to arrange new financing when you’re already in default on your existing mortgage. Be very cautious about sending advanced fees of $300.00 to $600.00 to lenders or mortgage brokers. Usually it’s a ploy to take advantage of your financial situation.

If you attempt to refinance, you should always have a backup plan available to you. Many times I have had homeowners call days before the auction saying their financing did not go through, and then it’s too late!

This is only one of the many useful sections of this 50-page eBook. If you are interested in picking up a copy of this great coaching guide, please visit our Foreclosure eBook website

Originally posted 2008-01-06 08:55:39. Republished by Blog Post Promoter

The other night, Virginia from Irving Texas asked on this weeks Massive Profits in Foreclosures call “ Will this change the landscape for investors working with those in Foreclosure?”

The Answer is YES- – -for the better.

You be the good person to help the homeowner make sure they have evaluated all their options.

These are two ways you can help the homeowner take action before foreclosure:

#1 Learn and share all options available to the homeowner if they do not want to sell their house. You can find those in this book, ‘Avoid Foreclosure Following the SMART STEPS Plan’.

#2 Make sure they have done all they can with Project Lifeline.

This project allows you, as the investor, more time to work with homeowners on a plan to buy their house should the bank’s option not meet the homeowner’s needs.

What is Project Lifeline?

The program would let qualified homeowners who are at least 90 days late on their mortgage payments pause the foreclosure process for 30 days. During the extra time provided by the program — called Project Lifeline — lenders and borrowers would try to work out more affordable terms.

“Project Lifeline is aimed at homeowners who face a real risk of losing their home and have not yet addressed the problem,” he told reporters. “Perhaps they are hoping to find a way to get current on their mortgage payments, or perhaps they don’t think any solution is possible. For whatever reason, they have not yet taken action. Our hope is that today’s announcement will reach them, and they will reach out immediately for help.” Secretary of the Treasury Henry Paulson.

On a pilot basis, the plan involves only six of the largest mortgage lenders, in hopes that more lenders will sign on. The participants are Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., JPMorgan Chase & Co., Washington Mutual Inc. and Wells Fargo & Co.

“Achieving contact with homeowners to present available options is the biggest obstacle we face in avoiding preventable foreclosure,” said Bank of America’s Floyd Robinson.

You can help the banks biggest obstacle by making sure anyone you talk to in foreclosure knows about Project Lifeline. This means you will be working with those in foreclosures with the “integrity and passion”. Remember to encourage the homeowner to contact you first to buy the property if things are not worked out with the bank. And wish them the best. It’s the right thing to do.

Tamera Aragon
Success Trainer and Coach
Ispiproperties.com

Originally posted 2008-02-14 08:17:22. Republished by Blog Post Promoter

Definition: Joint ownership of a property by one or more owner-investors and one or more owner-occupants. The owner-investors get the benefit of depreciation, and the owner-occupants can treat a part of their monthly mortgage payments as rent, and benefit from tax write-offs for interest and property taxes. When the property is sold, both types of owners share in the profit or loss realized from the sale or refinance.

This might be for you if there is some equity in the house and you would like to continue to hold it. It is vital you involve an attorney to put this together assuring all documents are formally filed correctly, protecting your asset. The benefit to you in utilizing this option is you are able to keep your house and lower your payments. Since the equity sharing partner would see the value of their investment at a later time, a plan for this would need to be in place in agreements filed with attorney, at time of sale.

Steps:

a. Partner(s) put up part of the required cash to cure foreclosure
b. Partner(s) pay part of monthly payment
c. Partner(s) get some percentage of ownership
d. Partner(s) get their money out at refinancing or sale down the road

Click Here for more coaching…

Originally posted 2008-01-11 08:51:08. Republished by Blog Post Promoter

Definition of Forbearance: The act of a creditor who refrains from enforcing a debt when it falls due.

Loan forbearance is a new agreement with your lender to repay your past due payments when you are behind on mortgage payments. This will stop foreclosure sale of your home quickly.

Forbearance is easier to arrange prior to the Mortgage Company filing a foreclosure lawsuit. Some lenders will not consider this after filing, but it’s worth trying.

This is the most common way of resolving a loan default. You and the lender agree to work out a plan which will let you repay part of the delinquency each month, along with your regular monthly installment.

If you have incurred a short term financial hardship and your loan is 90 days to 365 days past due, you might consider submitting a request for a special forbearance. A special forbearance is designed to provide you with more relief than is possible with a regular repayment plan. There are usually two types of special forbearance available to you.

Type 1: Typical approval can result in spreading the repayment over 12 to 18 months.

Type 2: This option most often is utilized in an unemployment situation whereby the promise of future employment is present.

If you are temporarily unable to meet your monthly mortgage obligation, ask your lender’s loss mitigation specialist if this is an option for you. Under such an agreement, the lender suspends and/or reduces payments for a period, usually less than 6 months, although it can go longer. At the end of the reduced-payment period, a repayment plan kicks in. You agree to make the regular payment plus an additional agreed-upon amount that will cover all the payments that were not made during the forbearance period. The repayment period is usually no longer than a year. If the plan is successful, you will be brought current and the lender will suffer no loss.

However, the lender will only consider this approach if convinced that your financial problem is temporary. The burden of proof is on you to document the case. Lien holders will usually cooperate if you can show the ability to resume payments on a specific date in the near future. You may qualify for this if you have recently lost your job or your source of income, or if you had an unexpected increase in living expenses.

When coordinating a forbearance plan, you must furnish information to your lender to show that you would be able to meet the requirements of the new payment plan.

Please Note:
Unfortunately 85% of homeowners fall out of Forbearance within just 2 to 3 months. The reason is they can’t afford the higher payment amount. Also, understand that just because you work out a deal with the bank, you are NOT out of foreclosure. In fact, you are STILL IN FORECLOSURE until you complete the entire forbearance agreement plan. Then and only then will you get a foreclosure withdraw letter from your bank stating that your loan is current. In the mean time, the bank will usually keep passing the foreclosure sale date each month – moving it to the next month. But, if you don’t pay ON OR IN ADVANCE of the payment due date (even if you are just one day late!), the bank can sell your home ASAP at the next sale date. If this happens, to avoid that fast foreclosure sale, you should contact your bank immediately and try to work out a NEW forbearance agreement if possible – but understand that once again, you will need to come up with that large down-payment and you will get a new (even higher) monthly payment.

For more coaching on foreclosures

Originally posted 2008-02-03 08:31:48. Republished by Blog Post Promoter

Definition: The delinquency is added to the loan balance in order to bring your payments up to date. Adding past due loan amounts to your current loan balance increases your loan balance and will also increase your monthly payments. The amount of the payment increase will be smaller if the life of your loan is extended at the same time as well. This is a good option if the reason for your mortgage default was temporary and your future income will support the new payment.

Go here for more Foreclosure Coaching

Originally posted 2008-06-16 13:20:46. Republished by Blog Post Promoter