The Real Face of FHA
With FHA being named the patron saint of homeowners trying to avoid foreclosure by virtue of the American Housing Rescue and Foreclosure Prevention Act, you would think that they’d be relatively easy to work with, right?
After all, with the “concessions” and “full faith and credit of the U.S. government” backing, the unqualified confidence of the House and Senate, and a host of new foreclosure-fighting responsibilities based on their reliability, you’d think that if a borrower had ANY chance of keeping their home, that the mortgage servicers and the folks at HUD and FHA would give most ANY borrower a look, right?
And, if they had a legitimate hardship which led to the foreclosure, and now had the ability to make their full payment with money to spare, well, that should be a lay-down, “Just show up and we’ll give you a loan modification,” right?
You’d be wrong.
I’m currently working with a client who TRIED all the normal things.
She called the servicer… several times. Every person told her a different story.
She contacted HOPE NOW.
She called a local “HUD approved” housing counselor.
She even asked her loan originator to try and intervene.
She was finally told to “send in your paperwork,” which she did, and wait for a response.
She followed up a number of times, with no real progress.
She did what she was SUPPOSED to do.
Two days AFTER her home went to the sheriff’s sale, she got a form letter from Wells Fargo, 3-4 days after her sale date, confirming that they’d received her information. That letter was dated January 23. Despite this, the house had already gone to sheriff’s sale on its originally scheduled date.
Now I fully expect to fix this situation, reverse the sale, and ultimately help her to stop foreclosure ex post facto, but if you are thinking that all you need to do is “show up” and they’ll automatically stop foreclosure and bend over backwards to help you to catch up payments and offer you a loan modification with no questions asked, I got news for you.
And due to the lateness of the hour and the surrounding circumstances, this is not just a matter of dialing up the mortgage company and politely asking for their cooperation.
No, this is going to require high-level contacts who’ve actually read (or written, or dictated) the mortgagee letters you can find at HUD clips.
Fortunately, I have those contacts… good to have when you need them.
You can behave like a good, little borrower, you can do all the right things and still get nowhere with your lender. You can fill out all the forms like you’re told, and diligently follow up to make sure that they’ve got them, and call to check their progress and still find that your home was sold and you failed to prevent foreclosure.
Now this is a well-worn path, and there are plenty of borrowers have done what they’re told and ultimately kept their home. But when you look at the KIND of loan workout many of them are getting, and the unreasonably high repeat rate (homeowners who find themselves in foreclosure AGAIN), it’s not enough just to show up.
Wouldn’t it be helpful to know how to play the game, to understand what to say, how to say it, and what your package needs to look like in order to get the results that you need to survive this? Wouldn’t it be nice to know what not to say, and to review your package for ”red flags” before you send it off for review?
The moral of the story is that if you’re serious about keeping your home and you want to fight foreclosure, I suggest you get yourself some EXPERT foreclosure help.
When it comes to trying to avoid foreclosure, the things you don’t know will hurt you. And, the things that you think you know may actually be false, especially in light of the proliferation of garbage “advice” on the internet and mainstream media on “Tips on How to Avoid Foreclosure.”
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