Fannie and Freddie take a break

From a recent press release comes this news - Fannie Mae and Freddie Mac will halt foreclosures of occupied dwellings from Nov. 26 to Jan. 9 so that mortgage loan servicers have more time to develop workout plans for struggling borrowers.

The plan could buy extra time for approximately 16,000 borrowers to try to save their homes, according to the mortgage giants, but some experts worry that it only will delay inevitable foreclosures.

Meanwhile, the companies will commence a streamlined modification program on Dec. 15, under which hundreds of thousands of borrowers shelling out over 38 percent of earnings on mortgage payments could see their payments lowered by lenders.

Several large companies, including Citibank, Chase Bank and Wells Fargo have launched major mortgage workout programs to help those homeowners that they inherited in their buy-outs of failed lenders like Countrywide and Washington Mutual. So, check before you let things slide into foreclosure or choose to try a short sale. There really is hope for homeowners.

No one benefits from all of these foreclosures and all of the banks are realizing that and trying to keep good, honest and hardworking home owners in their homes, if they can. There are some, maybe a lot, of these cases where the homeowner’s life circumstances have change so dramatically; or, where the loan abuse is so egregious, that there really is no way to find a workout that will work for all parties. So, we are still going to see foreclosures or have needs for short sales. If that’s the case for you, visit my Web site for short sales – http://www.mishortsales.net/. At least get some pros working on your side, if you have to go that route.

The key for distressed home owners more than ever is communications. Get on the phone and call your lender. Explain your situation and ask if they have a workout program. Tell them that you don’t want to loose the house and that you are capable of making reasonable payments to keep it – just not what your current mortgage requires. They may make you jump through a few hoops, but that’s a better thing than losing the house, so be ready to do whatever they ask of you – sending lots of records ands paperwork will likely be a part of the program.

If that doesn’t work, ask them if they will consider a short refi, in stead of going into a foreclosure (see the FAQ section of the site above for more on that). If they won’t even do that, then you may have no alternative than to consider a short sale. At that point, you have to accept that you will lose the house, but maybe that route will allow you to get back into home ownership faster than going through a foreclosure. Go to my Short Sales site for more on your options.