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Ask the Real Estate Lawyer - June 21, 2009
By Ilyce Glink and Samuel J. Tamkin
Q: How do I know if my loan is held and serviced by my lender or my loan is owned by a pool of investors?
Why is it that you have to be in financial trouble with your mortgage before you can get any help?
A: You may be able to find out whether your loan is only serviced by your lender and owned by others by calling your lender. Over the last decade, more loans were given to borrowers but ended up being serviced by one of several loan servicing companies. The actual loans were sold off in bits and pieces to investors in the United States and around the world.
The servicer has the right to receive payments on the loan but does not necessarily have the right to modify the loan terms. If you call up your lender and are told that they own the loan, you have a better chance of having that lender work with you to refinance or modify that loan.
There are millions of borrowers in trouble today. Many of them have failed to make several payments on their mortgage loans. Others have quit paying their properties, moved out, and have mailed their keys to their lenders in what is now known as "jingle mail." Still other homeowners are in trouble due to a job loss or medical bills but are current with their payments.
The government has set up various plants to assist homeowners with their mortgage problems. The Making Home Affordable plan that the Obama administration has enacted does not require homeowners to have missed loan payments to their lenders. The plan is voluntary, which means that while your lender may participate, it may not subscribe to the entire plan.
So many people are in financial trouble right now that many lenders are handling the worst cases first and do not appear to have the manpower to work with borrowers who are not "in trouble" today. In the last several months, readers have consistently said that their lenders won't work with them unless they are late in their payments. It may be that lenders want to know that they are working only with the most critical cases first and don't need to work with those cases where borrowers are current in their payments.
Or, perhaps it's that the Making Home Affordable plan in its original inception was designed to help borrowers who were late on their payments. More recently, the plan has been changed to accommodate those who are on-time with their payments but are facing tremendous financial difficulties.
Certainly lenders know they have a problem when a borrower stops paying on his or her loan. But the lender may think everything is fine when the loan is current. Individuals working with troubled borrowers seem to confirm that lenders aren't yet working with borrowers that are current in their loan payments.
Some borrowers, when they hear that they must stop paying on their loans to get lender help, stop making their loan payments. Their credit history takes a big hit, but they feel that's the only way they can get their lender's attention.
On the other hand, other borrowers are writing in to tell us that even after they stop paying, their lender's department doesn't have the staff necessary to work with everyone who is in trouble. If that's the case, lenders will prioritize their cases and will probably still only work with borrowers that have fallen behind in their payments before tackling borrowers that are current in their loans.
If you can't get your lender's attention, the best thing you can do is to keep calling. Let the lender know you want to work things out. Ask what you can do to speed up the process. As is the case so often, the squeaky wheel gets the grease. If you can't get anyone to respond to you, please call the Hope Now hotline at (888) 995-HOPE. The HUD-certified housing counselors at the other end of the line have backdoor channels that enable them to get through to the right people at your lender's office.
Paying Off the Mortgage: Readers Tell Their Stories
By Ilyce Glink
One of the big topics of conversation is figuring out when refinancing or prepaying your mortgage makes sense.
House Prices, Mortgage Interest Rates Key to Housing Market Recovery
By Ilyce Glink
With housing prices falling and mortgage interest rates rising, it's hard to say the housing market has bottomed out. And, yet, there are some reasons for a more optimistic housing forecast, according to Mark Zandi, chief economist for Moody's Economy.com
Reverse Mortgages Don't Allow You to Borrow 100 Percent of Home Value
by Ilyce Glink - Real Estate Matters
A reverse mortgage allows homeowners over the age of 62 to tap into their home equity. You can either take the money in a lump sum, as a line of credit (which it sounds like your husband opted to do), monthly payments, or a combination of all three.
Ask the Real Estate Lawyer - June 14, 2009
By Ilyce Glink and Samuel J. Tamkin
Get a Job and Then Buy a House, Not Vice Versa
By Ilyce Glink
The fact that you're moving without a job is problematic if you intend to buy a house. If you quit your job and then try to close on a house, you may not be able to at the last moment. That would be a disaster for you and the sellers
Samuel J. Tamkin is a Chicago-based real estate attorney.
Ilyce R. Glink's latest ebooks are "Save Your House From Foreclosure" and "The Clutter Collector: How to Get Rid of Clutter Everywhere In Your House," which are available at her Web site, www.thinkglink.com. If you have questions, you can call her radio show toll-free (800-972-8255) any Sunday, from 11 am-1 pm EST. You can also write to Real Estate Matters Syndicate, PO Box 366, Glencoe, IL 60022
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