Facing Foreclosure? 12 Things You Should Know When You Call Your Lender

October 16, 2007, 8:57, am By 4 Comments

If you are having trouble making payments on your home then the first thing you should do is call your lender/servicer. For many people this can be a frightening proposition. You might be afraid you’ll end up saying something that will put your home in jeopardy. Or, you might not understand the different options the lender offers. Or, you may simply just not know what to say.

The Mortgage Bankers Association has created a foreclosure avoidance center website. Under this page it has published a twelve-step guide on the things you need to know when you call your lender. This should ease your fears a bit. Additionally, as you go through this guide you’ll realize that a successful resolution is in the lenders best interest as well. Contrary to public perception the bank does not want to own your home and bank executives do not go to bed at night salivating at the prospect of foreclosing on your home.

Below is a quick run down of the twelve steps, but read the “12 Things You Should Know When You Call Your Lender” page on their webpage for complete information.

  1. Contact your servicer immediately
  2. Ask your servicer about alternatives to foreclosure
  3. Provide any information requested by your servicer
  4. Be prepared to provide detailed financial information
  5. Be ready to change your spending habits
  6. If you’re uncomfortable calling your servicer, then call a reputable third party (see HUD website)
  7. Open all mail you receive from the servicer or it’s law firm
  8. Do not hesitate to ask critical questions
  9. Resolve any payment issues on your escrow accounts (taxes and insurance)
  10. Stay in contact with your servicer and/or counselor at all times
  11. Be realistic about your own financial condition
  12. Understand that the servicer wants a positive outcome

Related entry: Kits to help you avoid foreclosure and payment defaults

Filed Under: Banker, Mortgages, Personal Finance

Bad Credit Can Cost You Your Next Job and Your Dream Promotion

October 10, 2007, 1:54, pm By 8 Comments

Not only can bad credit cost you big bucks, it could even cost you that new job you want or the promotion you’ve been working so hard to get.  It’s hard to believe, but it’s true, more and more employers are pulling credit and screening out job applicants.

I vaguely remember a conversation from a few months. The person I was talking to mentioned how he needs to get his credit in order so he could get a better job. I had to give my thumped look. You don’t often get to see my thumped look.

I know business owners and self-employed people may need to furnish credit reports for business loans or big contracts. Also I was aware of top level sales executives at large companies needing to furnish a credit report annually so the company feels comfortable with their money and debt management.  But I was not aware of how this practice had trickled down to include regular folks in regular jobs. 

At first I didn’t think employers could do this and I wasn’t sure it would prove to be terribly informative. But I found they could. I also did some research on how extensive this thing was and found that employers are increasingly relying on credit reports to screen out job applicants. Here is what I found on the Bankrate.com website:

More and more employers are using credit reports to screen employees. The use of credit checks has increased 55 percent since 2000, according to a 2006 national survey conducted by Harris Interactive for Spherion Corp., a leading recruiting and hiring firm.

So what are employers using your credit reports for?

… ”many companies use credit reports primarily for authentication of the name and address history of the applicant, perhaps paired with a separate search of criminal history, rather than for the credit performance of the individuals being considered, especially if there are no significant credit issues.”

Again, is this legal? According to the FTC, it is permitted as long as the employer receives a written permission to pull credit. I guess it’s part of the background check.

There is more at stake with the credit report, manage it well.

Filed Under: Credit Bureaus, Credit Scores, Personal Finance

Kits to Help You Avoid Foreclosure or Mortgage Defaults

October 3, 2007, 8:46, am By 1 Comment

There are lots of online tools available for homeowners facing foreclosure and/or those having difficulty with their mortgage payments. These tools might be helpful if you’re in an adjustable rate mortgage which is to reset to a higher interest rate, or even for those facing job loss or other financial hardships.Below are a few tools I’ve found which would help you understand your options and determine exactly what is available to you.

These are kits only, so don’t hesitate to contact me if you ‘d like me to take a look at your situation. As a qualified mortgage professional I’ve been working with lots of homeowners facing hardship. I have been helping them to understand their mortgage and find long term solutions. I don’t charge for this and would be more than willing to sit down with you for a consultation.

  1. 13 Homeowner Solutions to Avoiding Default & Foreclosure™ – This is a public education and outreach service for borrowers distributed by HUD, VA, FHA, Fannie Mae, Freddie Mac, FBI, Congress and the industry.
  2. Mortgage Reality Check - This tool will help you determine the type of situation you are and it recommends solutions. It is in a quiz format. It will take you a couple of minutes to answer all the questions.
  3. Save Your Home Kit – TheMortgageMess.Com now has state specific kits to help you save your home and avoid foreclosure. The Arizona kit costs $47 and from what I can tell from its website, this looks like a legitimate business with a good product.
Filed Under: Interest Rate, Personal Finance, Subprime Mortgages
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