Foreclosures up 24%; avoid losing your home

by Center for Personal Finance editors

IRVINE, Calif. (4/20/09)---A report released last week revealed that one of every 159 U.S. housing units received a foreclosure filing during the first quarter of 2009, representing a 9% increase from fourth quarter 2008, and a whopping 24% increase from one year ago (RealtyTrac April 16).

The figures for first quarter 2009 were the highest monthly and quarterly totals since RealtyTrac began releasing foreclosure data in January 2005.

Thousands of homeowners are in fear of losing their homes during this difficult economic slump, due to higher adjusted monthly payments, layoffs, insufficient emergency funds, excessive debt, toxic mortgages, mortgage rescue scams, and more. Regardless of the reason, if you are vulnerable it's critical you take action immediately:

• Call your lender--now. Face the problem head-on and take initiative, which shows you're acting in good faith. The longer you wait to make the call, the harder it will be to develop an action plan to save your home.

• Explain your situation. By coming clean, you'll open discussion about available options, such as a reduction in interest rate, lower monthly payments, or a repayment plan that fits your budget.

• Know your rights. Find out the specific foreclosure laws and time frames in your state. Do an Internet search for "state government housing office." Sift through your loan documents to determine what the lender can do if you don't make your mortgage payments.

• Know how to spot a rescue scam. Con artists use half truths and outright lies to promise a solution, and then fail to deliver. Watch for messages like, "We guarantee to stop your foreclosure," and "We can save your home, free consultation," and "We can stop foreclosures this week!" They get your name from public foreclosure notices in newspapers and in public files at local government offices. Be suspicious of unsolicited personalized letters promising speedy relief.

• Find legitimate help. Besides contacting your lender, get help from a reputable credit counselor by calling 800-388-2227. The National Foundation for Credit Counseling has a Homeowner Crisis Resource Center at nfcc.org.

For more information, listen to "Rising Rates--Safeguard Your Home by Maintaining Mortgage Payments and Avoiding Foreclosure" and "Find Foreclosure Counseling" in Home & Family Finance Resource Center.


Printed Wednesday, November 25, 2009

  Home & Family Finance® Resource Center
  Copyright © 1997-2009 - Credit Union National Association Inc.