This past quarter, more than 895,000 foreclosure filings were reported on U.S. properties, and bank repossessions increased a record 5 percent. Foreclosure filings may exceed 3 million before the end of 2010. For homeowners who are delinquent on their mortgages, this may seem like old news. What they may not know is that free, HUD-approved housing counseling is available and may help them sort through options and find a solution to their problem.
Tom Simonton, Manager of Housing at Consumer Credit Counseling Service of MD & DE (CCCS), a BBB Accredited Business, notes, “When people get behind on their mortgages, they often react with fear and desperation. They may have talked with their lender already, but are frustrated, because they still don’t have a real course of action. HUD-approved housing counseling like we provide makes it possible for clients to fully evaluate their situation. During a counseling session, we help them determine where they stand financially and examine all available options. Our clients leave the session with a better understanding and a clear plan of action.”
Simonton acknowledges that the “face of foreclosure” is changing. “When the foreclosure problem first hit, most of the clients we saw here at CCCS were people of modest means who may have purchased more home than they could afford. Then as the economy got worse, we started seeing people who had solid careers and good incomes, but who had lost their job or run into other economic hurdles. Now, we are seeing people from all sectors of society. Clients may have triple digit incomes or be retired, but due to investment losses, they are now having trouble making their mortgage payments.
A recent online survey by Housing Predictor asked participants, “Are you afraid of losing your home to foreclosure or have you already?” Eight percent responded that they had already faced foreclosure; 30 percent -- or nearly one in three -- stated that they are afraid they will lose their home.
Local residents who have fallen behind on their mortgages aren’t just fearful; they are vulnerable: Late night cable is full of unscrupulous spots that make false promises and that may ultimately result in consumers losing their homes. Commercials for these scams may make reference to a government stimulus windfall, but ultimately involve a large fee up front.
Desperate homeowners do fall prey to mortgage foreclosure prevention scams. There is no ‘one size fits all’ answer. It’s impossible to know what options are available without first analyzing a person’s finances and mortgage situation. Based on that assessment, there may be several ways to respond: For example, the homeowner may benefit from lender or government modification programs and initiatives. In some cases, it may be necessary to appeal decisions that have already been made. If the client is too far behind or has no viable income, it may even be necessary to sell the home.”
HUD-approved nonprofit housing counseling is free of charge. The first step to receiving help is to schedule an appointment. CCCS provides counseling throughout the Baltimore metropolitan area and in Easton and Salisbury. At the counseling session, consumers are asked to provide:
- Proof of income.
- An outline of monthly expenses and copies of major monthly bills.
- Most recent statement from the mortgage lender and other relevant communications.
- Legal foreclosure documents.
- Most recent tax return.
Experts recommend that clients put together a hardship letter that details when and why their mortgage payment problem started and if their inability to make payments is expected to be temporary or long lasting.