Did you know that foreclosures and mortgage defaults are up more than 20% in the US in 2007?
Did you also know that a reported 50% of people who went into foreclosure never even called their bank once the defaults started happening?
Listen, banks are not in the real estate market. They don't want to take your house from you. When a mortgage lender gives someone a loan they try to do so with minimal risk so that they can make money on the interest but not have the borrower default on payments.
That being said; if you or someone you know is having trouble making mortgage loan payments make sure you call and speak with your mortgage lender. The bank will work with you. They (the bank) have departments setup for this sole purpose. In some cases they will not offer you any relief until you are actually 30 days late on a payment, but guidelines change from mortgage company to mortgage company.
Trust me, it costs the mortgage lender a lot more money if you go into foreclosure than if you make a few late payments. They might be willing to restructure your loan at a lower rate. Some banks will forgive the borrower of a few months worth of payments as long as they start to make on time payments. In a lot of cases I have heard of banks putting interest on the back end of the loan to help borrowers catch-up. There are so many programs that banks are offering and people are not taking advantage of.
Keep in mind that in most cases if you are "forgiven" of any amount on your loan, that amount is seen by the federal government as taxable income. George Bush recently spoke about changing that ruling but for now that is how it stands.
If you have any questions or concerns please don't hesitate to call Justin Perry at First Call Mortgage Co.
Licensed by the New Hampshire Banking Department NMLS License #28231
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