I'm in a cranky mood this afternoon, because I spent a full hour on the phone with a client's lender trying to get an agreement that will help her avoid foreclosure. (see yesterday's entry)I call the lender to tell them that the current payment ($1461 a month) is unaffordable, and can't we work out an agreement where the loan is re-financed for 40 years instead of 30? I explain that as the neighborhood Real Estate expert who's sold homes just like these for the past 3 years, I'm here to say you, Mr. Lender, will lose at least $75,000 if you issue the foreclosure notice and we short sale it. So can't we work together to do something that results in a payment the homeowner can afford?
I'm thinking this is a reasonable plan: the lender avoids a huge write off and gets 10 years of extra interest payments, the homeowner gets to keep her home at a payment she can afford. Certainly not the lender's first choice, but a reasonable alternative if they're at least a little creative and progressive.
They turned me down flat. Wouldn't even discuss it. Also wouldn't discuss any other plan. No forbearance, no alternate arrangements, they won't try to refinance her.... You want to hear the lender's brilliant plan? The homeowner should send an extra $862 per month for 4 months, and then she can go back to her regular $1461 a month payment and everything will be fine. Oh, and for a limited time only, because you're such a good customer, we'll ding your credit rating every month with a late code on the extra-big payment.
What the heck kind of plan is that? If she can't afford the current $1461 a month, what makes you think she's got $2323 a month? You think she's going to Vegas every weekend with an additional $862 and she just "forgot" to send to you?! Sheesh!
So all's I'm sayin' is, if you're even a day behind on your mortgage payment, call your lender. If you think this isn't a once and done fluke of a situation, call. If it might be a whole month late, or if some emergency came up, or if you just can't afford the payments... call right now. Don't wait until you're 3 months behind like my client did. The banks just don't have a lot of wiggle room to negotiate another deal if you've left it go for months. Call today. Please.