Friday, September 26, 2008

I Can't Pay the Mortgage, Help!

If you're facing troubles paying your mortgage, act quickly. Don't wait. Don't hope it goes away. Don't avoid your lender's collection phone calls and letters. The bad news is you're in a pickle and it'll take some work and sacrifice to get out. The good news is that since so many Americans are in the same (leaking) boat with you, there are an ever-growing number of programs and plans to help you.


One of the most important things to know is that you do not need to pay anyone to help you out of your financial distress. Anyone who asks for an up-front fee is probably a scam artist.


Similarly, I personally am very skeptical of foreclosure "experts" who have slick marketing materials and a professional sounding plan, and want you to start by signing  a transfer deed changing ownership of the home to them. If you transfer ownership of your home by signing a Deed of any kind, you do not transfer responsibility for paying the mortgage. Essentially it's like giving away your car and agreeing to continue making the car payments. Not a great idea. If a foreclosure expert approaches you with a "program" that includes signing a transfer deed, warranty deed, or quit claim deed as the first step, call an attorney for advice. Fast.


The second important thing to know is that I am not an attorney. I am not giving legal advice. I'm jotting down some of the advice I give my own clients, after hearing about their entire situation and after I tell them to consult a tax professional and an attorney. Please do not consider the advice below as perfect for your situation. Consult an attorney, a knowledgeable Realtor, and your tax preparer.


Now some resources.




Next up, understand the timing related to a Notice of Trustee's Sale (this applies only in metro Phoenix where I work). The Notice is simply a formal letter to you, from your lender stating that they know you're behind on your payments, and if you do nothing they will sell your house at a foreclosure auction in 90 days. That's 90 calendar days, not 90 business days.


A Notice of Trustee's Sale is not a foreclosure; you still own your home. You can try to work with your mortgage lender to create a payment plan you can afford. You can try to sell your home before the foreclosure happens. You can hire a Realtor or a foreclosure expert to help you with these actions.


Whoever you choose to work with, check them out! Distressed markets like we're in create room for a lot of really sleazy, smarmy people to scam innocent folks. Ask for references and call those references.


If you choose to work with a Realtor or a foreclosure expert, call their prior clients. Ask those folks how recently the Realtor helped them, what happened, and whether they were happy with the work done for them. Ask them if there was anything they were unhappy about too. If you choose to work with a company, check them out with the Better Business Bureau and/or the local Chamber of Commerce. You can see a list of various state's Chambers here.


This is a list of online spots you can trust to give you free, unbiased and scam-less information:




  • Fannie Mae

  • Freddie Mac (don't let the recent "government takeover" news scare you off. There's a new set of faces in upper management at each company, but they're still doing business)



Of course, if you're ready to list your house for sale as a short sale, feel free to call me. I've successfully sold several short sales this year, and helped a few buyers make offers on short sales too. My goal and daily practice is providing pressure-free truthful information. If I can help you, I'll say so and tell you about my commission fee structure right at the beginning. If I can't help you, I'll tell you that honestly too, and help you find someone who can get you out of your pickle. You can start getting to know me better online by reading this series of articles I wrote for buyers considering short sales.


More info soon in Part 2, including getting a loan modification, a workout, and/or listing your home for sale as a Short Sale.


Related Posts




  1. I Can't Pay the Mortgage, Part 2

  2. I Got a Notice of Trustee's Sale, Now What?

  3. REO, short sale, foreclosure - What Do They All Mean?

  4. I'm Quoted In USA Today Talking About Foreclosures