As foreclosures continue to mount nationwide and with prices still declining, lenders are now more willing than ever to work with struggling homeowners to help keep them in their homes.
Hope Now, a consortium of loan servicers, lenders and investors reportedly restructured 192,034 loans in July alone. Of these, 80,000 or 42% involved permanently modifying the loan terms to make them more affordable. A year ago, only 24% of the workouts arranged included permanent modifications. The remaining 112,034 workouts involved new repayment plans. The coalition reports helping more than 2 million borrowers during the last 13 months.
Many lenders, servicers and investors were initially reluctant to restructure the original loan terms. But as it's become more obvious that the problem is widespread and not likely to turnaround anytime soon, they are now cooperating more with borrowers.
Surprisingly, the majority of struggling borrowers do not contact their lenders to try and arrange a solution. According to Faith Schwarz, the executive director of Hope Now, of 1.6 million letters sent out by the coalition since November 1 2007 to borrowers 60 days past due, 80% of borrowers had not contacted their lenders a month after receiving the letter.
If you or someone you know is struggling with making your mortgage payment, please contact your lender. Communication is key. And the sooner the better.
If you'd like to discuss your situation with me in strict confidence and without obligation, please call.
The Hope Now alliance can be reached at http://www.hopenow.com/
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