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With today’s economic crisis we are seeing record highs of foreclosures on the market. If you are in this situation there is probably a million questions running through your head.

Probably the most important, and most frequently asked, is how it will affect your credit. Of course a foreclosure on your credit history will be detrimental.

Natalia Osorio Editor of the “Stop Foreclosure Loans” website — http://www.StopForeclosureLoans.org — pointed out;

“…There really is no disclosed number of points that will be docked from your credit score; however an unofficial number has been rumored to be around 260 points. A good credit score is 700 or higher. An average credit score is around 600. Therefore if you’re current credit score is at 650 you can roughly expect your score to drop to around 390. Even if you have an excellent score of 800 your score will be dropped to around 540 which are still considered to be a negative credit score…”

There are two main reasons that we as a country are currently in this housing crisis. The economic crisis was started by borrowers taking out bad loans, and lenders selling the bad loans to the consumers. Most of these loans included arms which is where the payments were low for the first few years. After the first few years the payments would skyrocket. Lenders would sell these loans to consumers by telling them that they would be able to sell their homes or refinance their homes when their payments increased. Other bad loans included variable interest rates. This again would give a good introductory interest rate, and then the interest rate would increase exponentially after the first few years making payments impossible for the home owners.

This started a domino effect which eventually leads us to record breaking unemployment rates. Because there were millions of these types of loans all at the same time it forced many home owners to go into foreclosure. This affected many industries including banking and real estate. It then got difficult for these consumers to afford or finance anything which then hurt other industries such as automotive and furniture.

“…If you are in this situation there are a few things you can do to stop foreclosure. There are many foreclosure assistance companies that can help you go through your bills, consolidate your debts, and negotiate with your mortgage lender to get your monthly payments down to something you can afford. You can also contact your mortgage company immediately and try to work out a loan modification. You should also research options such as short sales, a deed in lieu, or cash for keys…” N. Osorio added.

Further information about how to get professional assistance with a mortgage loan modification by http://www.StopForeclosureLoans.org

Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.

Article Source:http://www.articlesbase.com/mortgage-articles/how-does-a-foreclosure-affect-your-credit-1786824.html

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Sadly, the media is full of news of the economy’s turns, dips, and downward spiral. Given the domino-effect of such news, it is not unlikely to think that you may be affected.

A few years ago, buying a home or property was a smart investment. After all, you could buy a property, work on it, and then sell it for more. However, in today’s day and age, foreclosures are becoming more and more common.

Natalia Osorio Editor of the “Loan Modification Foreclosure” website — http://www.LoanModificationForeclosures.com — pointed out;

“…In the event that you can no longer make your payments on a home or property, a bank or lending institution is bound to take it back. Thus, you lose your property and your investment. When this happens, this is called a foreclosure. Sadly, people around the world have to deal with this kind of loss. However, a foreclosure has many more effects on a person. It could affect everything from your credit rating to your personal finances. The following are some things that people do not always know about foreclosures and their effects…”

A foreclosure directly affects a person’s credit score. Whenever you can’t make a payment, this is reported to credit agencies. Thus, if you end up not being able to keep up with a mortgage or with payments on a property, this will show up. If a lending institution ends up seizing and placing a home in foreclosure, this too will be reported and will show up on your credit history. Everyone from prospective employers to landlords can see this document. Thus, the effects of a foreclosure can definitely affect other areas of your life. Thus, you should do everything in your power to avoid such a situation. If you do end up with a foreclosure on your hands, be prepared to explain this in the future.

“…In the future, if you look for a mortgage, car loan, or even a credit card, your foreclosure will affect not only whether or not you approved but the rates you have to deal with. A foreclosure shows a lending institution that you have not been able to keep up with your payments in the past. Thus, it shows banks and other organizations that you are a risky investment. No lending organization wants to end up losing money on you. Thus, even if you are approved for a home or auto loan, you may have to deal with high interest rates…” N. Osorio added.

Further information about how to get professional assistance with a mortgage loan modification by http://www.LoanModificationForeclosures.com

Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.

Article Source:http://www.articlesbase.com/mortgage-articles/how-can-foreclosure-on-an-investment-affect-my-personal-finances-1779050.html

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If you are reading this, then you are probably already aware of the rising rate of foreclosures across the nation. You may even be one of those who are caught between a rock and a hard place regarding your mortgage payments.

You’ll find many helpful sites on the internet offering advice on how to negotiate with the lender, work out some type of payment plan, avoid foreclosing and keep your property. However, all of these suggestions have one thing in common. They presume that the individual has a source of adequate funds. This strikes me as somewhat ironic in that most folks who face foreclosure do so because they have inadequate funds!

Hector Milla Editor of the “Best Mortgage Loan Modification” website — http://www.BestMortgageLoanModification.net — pointed out;

“…Whatever situation has caused this lack of income, the fact is that the property has become unaffordable for them. Once this fact is realized, the financial focus should shift from how to retain ownership of the unaffordable asset to how to maintain a credit score until life circumstances change for the better. It is well known that foreclosure proceedings will devastate a good credit rating and once these proceedings take place, there will be no funds and no credit. Better to at least hang on to good credit by selling the property before a foreclosure takes place…”

There may be offers to purchase the property at greatly reduced price once it is in pre foreclosure. Better to be proactive and list the house on the market. You will most likely take a significant loss in order to sell quickly, but at least you will have a better chance of getting a market value offer, and just listing the house may forestall proceedings by the lender. Sadly, you will loose your home, but will be able to reestablish a more affordable home with good credit.

There is one alternative to selling to a third party. Some lenders will consider taking deed in lieu of debt. This means that the title to the property will revert back to the lender in exchange for forgiveness of the debt if the value of the property is deemed sufficient to cover the debt. In a way, this is like selling the property back to the lender. However, if the debt amounts to more than the property is worth, beware!

“…The lender may sue for the difference of the value amount, or report that amount to the IRS as taxable income for the owner. Credit scores may also be hurt by this arrangement. This should be a last resort strategy to use only when you just can’t find any buyers. Remember, the sooner a house is listed, the better the chance of a satisfactory sale and of a new beginning…” H. Milla added.

Further information about how to get professional assistance with a mortgage loan modification by visiting; http://www.BestMortgageLoanModification.net

Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.

Article Source:http://www.articlesbase.com/mortgage-articles/how-can-i-sell-my-home-before-foreclosure-1779292.html

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Many people have questions about foreclosures these days.

One of the many questions being tossed about is if a home is foreclosed on in my neighborhood does it lower the value of the surrounding homes. The answer here is a resounding yes.

Hector Milla Editor of the “Best Mortgage Loan Modification” website — http://www.BestMortgageLoanModification.net — pointed out;

“…Property values are based upon a numerous factors. One of the most important factors in determining a property’s value is recent sales statistics. Appraisers, to determine an average price for a home in a neighborhood, use recent sales statistics as a yardstick to measure all the remaining factors…”

To determine a home’s present worth appraisers find three comparable homes that have recently been sold in a neighborhood. They must use this average price as a gauge to determine the value of all other comparable properties in the same neighborhood. After the average price is determined the appraiser looks at other factors to determine the property’s exact value. A home’s value usually cannot exceed the average value determined by the last 3 comparable sales in the neighborhood.

For example, house A, a 3-bedroom home in a neighborhood recently sold for $100,000. A comparable home across the street, house B, sold for $115,000. A third home, house C, comparable to A and B, sold for $107,000. The median price for a comparable home in this neighborhood would be roughly $107,000.

When a home in the neighborhood is foreclosed upon the recent sales statistics will reflect the price paid for the home at the foreclosure auction. This, sometimes drastically, lower price effects the average home price in the neighborhood and as with valuation system based on averages, drives the average home price in the neighborhood lower. The result of a lower average median price is that all the remaining homes in the neighborhood lose value.

For example, house A, a 3-bedroom home in a neighborhood recently sold for $100,000. A comparable home across the street, house B, sold for $115,000. A third home, house C, comparable to A, B, was foreclosed upon, and the price at the auction sale was $75,000. The median price for a comparable home in this neighborhood would be roughly $96,000.

“…Every home in the neighborhood with the foreclosed property would be worth $17,000 less than if there was not a foreclosure in the neighborhood. This decrease in value for the entire neighborhood will not change until the sales prices for comparable properties increases…” H. Milla added.

Further information about how to get professional assistance with a mortgage loan modification by visiting; http://www.BestMortgageLoanModification.net

Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.

Article Source:http://www.articlesbase.com/mortgage-articles/does-a-foreclosure-on-a-house-lower-the-value-of-other-houses-1777241.html

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Many people have questions about foreclosures these days.

One of the many questions being bandied about is can the lender who holds the 2nd note on my home force me into foreclosure if I am delinquent. The answer is yes.

Natalia Osorio Editor of the “Stop Foreclosure Loans” website — http://www.StopForeclosureLoans.org — pointed out;

“…A 2nd loan is also a recorded debt against your home. When borrowers take a 2nd loan they guarantee repayment of the loan and the collateral used to guarantee the loan is the property on which the loan is issued. As with any loan secured by real property if the 2nd loan becomes delinquent the lender who issued the loan will foreclose on the property in order to be repaid…”

When a loan in 2nd position moves to foreclose on the property the lender in 1st position will immediately begin to protect their investment and usually will also begin foreclosure proceedings.

When the lender in 1st position is also the 2nd position lender there is a chance they will work with a borrower to protect their investment. Lenders are usually reluctant to foreclose upon a property unless all other avenues of securing the repayment have failed. For example loan modifications, refinancing of the property, deed in-lieu of foreclosure, and short sales are some of the alternatives to foreclosure.

Also keep in mind that if a property does get foreclosed upon the borrower will still be liable for the amount left over from the foreclosure. For example if a home goes into foreclosure and the money from the proceeds of the sale are not enough to pay the existing 1st mortgage the borrower will still be legally liable for the balance of the 1st mortgage as well as any 2nd loan still on the property.

If a borrower is facing foreclosure, the most important thing for them to do is contact their lender to see what options are available to them to prevent the foreclosure. Next steps to take after contacting the lender should be contacting HUD to see what options they offer to prevent foreclosure. After all other options have been exhausted; a borrower should consider contacting a mortgage modification company.

“…Remember a mortgage is a loan collateralized by a piece of real estate. If a borrower defaults on a 1st or 2nd mortgage the lender will move to protect its investment by foreclosing on the property securing their debt…” N. Osorio added.

Further information about how to get professional assistance with a mortgage loan modification by http://www.StopForeclosureLoans.org

Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.

Article Source:http://www.articlesbase.com/mortgage-articles/can-the-lender-who-holds-the-2nd-on-my-home-force-me-into-foreclosure-1763670.html

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