Foreclosure Prevention

Greetings,

Thank you for visiting our Foreclosure Prevention webpage.

Tabernacle International Church believes every homeowner deserves the best information and education when experiencing a hardship that prevents them in making their mortgage payment on time. The sooner you get help with the problem, the better your chances of solving it.

Lenders ultimately want to keep homeowners in their home. Based on the S.A.F.E. Act (The Secure And Fair Enforcement For Mortgage Licensing Act of 2008) a federal law that went into effect January 1, 2010 prohibits third parties in discussing loan terms without a license. It is imperative that homeowner(s) receive trusted guidance in contacting, discussing and negotiating direct with their lender when they are facing financial difficulty to explore options to avoid delinquency.

Lenders have the authority and responsibility to use effective actions and strategies to help you stay in your home or at least help you avoid foreclosure while you try to sell your home if your hardship is going to be long term. Foreclosure is a process that allows a lender to recover the amount owned on a defaulted loan by selling or taking ownership (repossession) of the property securing the loan. Foreclosure is always the last resort and completely avoidable in most cases.

No, you do not have to be behind on your mortgage to be considered for a refinance or loan modification. If you are in an imminent danger of default based on facts and situation, and you most likely will be in default within the next 12 months, help is available today. And no you do not have to lose your home to foreclosure.

Please understand that foreclosure is a process, and there is time to make decisions that may result in a better outcome. Having the motivation to learn your options, the process and taking action immediately to select the route best for you and your family’s future is the most important decision you can make today.

If you are struggling to pay the mortgage and unsure of what to do next, please listen to the remainder of our message to help map out a plan in working with your lender. Stay in your home for now. You may not qualify for assistance if you abandon your property.

If your lender has called or mailed you documents, do not ignore them. The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notices of pending legal action. Your failure to open the mail will not be an excuse in foreclosure court. Lenders want to help and the further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house.

All lenders are required to:

• Consider all reasonable means to address delinquency at the earliest possible moment
• Inform homeowners of available foreclosure prevention options
• Inform availability of housing counseling
• Pursue resolution and utilize a workout option whenever feasible to avoid foreclosure

So let's get started!

Your lender – also called the servicer consist of several departments, i.e. Customer Service, Collections, Loss Mitigation and Foreclosure. We will be working with the loss mitigation department which was created between the federal government and the mortgage industry. The program was established to help homeowners that were facing the loss of their homes due to delinquent payments, stop foreclosure before it occurred. They have a variety of options to help you get back on track with your mortgage or help plan an exit strategy to relinquish homeownership while avoiding foreclosure and the massive credit damage that goes along with it when the hardship is not curable.

Step 1 -Before you began filling out the paperwork write down the answers to the following questions:

• What happened to make you miss your mortgage payment(s)?
• Do you have any documents to back up your explanation for falling behind?
• What actions have you tried to resolve the problem?
• Is your problem temporary, long-term, or permanent?
• What changes in your situation do you see in the short term, and in the long term?
• What other financial issues may be stopping you from getting back on track with your mortgage?
• What would you like to see happen?
• Do you want to keep the home?
• What type of payment arrangement would be feasible for you?

Step 2 -Organize Your Personal Documents And Information

Prior to contacting your lender you must organize all the paperwork and develop a plan. Your lender may require you to complete a loan workout package. It is important that you complete it as soon as you receive it because in some cases the lender cannot proceed to the next step without the completed and signed documents. Keep in mind, your lender's loss mitigation department receives hundreds of calls, faxes and email requests daily. An incomplete package could delay or even decline your request for an option to save the home from foreclosure.

Prepare the following information:

• A brief explanation of your hardship and supporting documents
• A detailed list of all your expenses, loans, and bills (lifestyle budget)
• Proof of all household income including your most recent pay stub, tax return or profit and loss statement
• 2 or 3 months of your bank account statements -all pages -all accounts
• Recent mortgage statements
• Your last 30 days paycheck stubs for all borrowers on the loan
• Your past two years of tax returns -all schedules and signed
• Visit your lender's website for additional instructions and required documents

First Impression

Your package of forms and supporting documents is the equivalent of your first impression. Complete the package correctly the first time. An incorrect or incomplete package can be shredded, not accepted by others and/or delay approval process six months or longer. No matter which option you choose, the process can be expedited significantly if these materials are assembled before hand

Step 3 -Contact Your Lender

Don't put it off, be embarrassed or be foolish because those responses will make the situation worse, not better.

Call today to discuss the appropriate solutions to your circumstances. You can find your lender's phone number on your mortgage bill. Be sure to have your account information handy and be ready to give a summary of the financial problems you are having. Be prepared for more than one conversation.

Questions To Ask:

• How much time is the lender willing to give you to complete a work-out?
• What are your obligations under the work-out package?
• What are the specifics? Be sure to ask what is due and when.
• Will a foreclosure sale of your property be put on hold while your lender looks at the possibility of a workout package?

If you have 2 or more mortgages you will need to contact each lender separately.

Step 4 -Understand All Your Options

The options made available will depend not only on your circumstances, but on the type of mortgage that you have. Here are some options your lender might propose to you:

• The President's Making Home Affordable Plan
• A traditional refinance
• A Forbearance program which buys time when the hardship is temporary. This plan was designed to reduce or suspend monthly payments for a short period of time usually less than four months. At the end of the agreed-upon period, you would be required to resume their monthly scheduled payment as well as pay additional funds to make up for the past due amount.
• A Repayment Plan that would add an additional amount of money determined by your lender to your regular monthly payment until the amount that was overdue has been repaid. This program can be stretched out to 36 months.
• A Loan Modification that involves changing one or more of the terms of a mortgage. This option generally is considered for homeowners whose financial problems are expected to be more long term. Lenders will only reduce your monthly first mortgage payment to 31% of your monthly gross income (income without deductions). Your total debt ratio which includes all monthly credit obligations and your housing expense, (PITIA) cannot exceed 55% of your monthly gross income. Plus you may be required to take a budget counseling session from a HUD approved housing counselor prior to approval. As hard as you try, sometimes financial hardships don't get turned around as quickly as you would like. These situations may include a long-term layoff, job loss, a mandatory reduction in pay, a disability or illness that results in a decrease in income or an increase in major medical expenses, or the death of the principal wage earner. In these instances, it may not be possible for you to continue to meet all of their financial obligations and the only appropriate course of action is relinquishing ownership of the home, while avoiding foreclosure. When the cause of the delinquency is not curable and you are not committed to remaining in the home, the lender will consider disposition options in this order:

• Loan Assumption
• Pre-foreclosure Sale (Short Sale)
• Deed-in-lieu of Foreclosure

The loan assumption and pre-foreclosure sale involves listing your home with a real estate professional and selling your home. Under the new U.S. Treasury Department initiative you will have four to twelve months to sell.

A deed-in-lieu of foreclosure takes place when you voluntarily gives the deed to the property to the lender in exchange for a release from all obligations under the mortgage. Generally, a deed-in-lieu is considered only after all other alternatives to foreclosure have been explored.

While this represents only a summary of some of the options available, it is important for you to understand all of them to find the best solution for you. Focus on an affordable outcome. A solution that is not affordable will leave you facing trouble again in the future.

After each conversation with your lender, keep good notes of all the contacts you make, including the dates and what you were told. Having good records is important. Keep it in a safe place where you will be able to find it easily.

Proceed carefully. If you are able to work out a deal, here are some additional tips:


• Get the agreement in writing.
• Make sure you understand the terms of the agreement.
• Make sure you can afford the plan.
• Do not fudge your numbers. If you negotiate a plan that is not affordable, you might not be eligible for another workout plan later.

Warning: Negotiating with the servicer or mortgage holder does not always postpone a foreclosure. Be sure to request the foreclosure process to be suspended while you complete your workout plan.

The Washington Post Reported on a Recent Study That Found:

"Troubled homeowners who receive housing counseling are 60% more likely to avoid foreclosure and have their mortgage payments lowered significantly than borrowers who navigate on their own".

You can arrange a confidential, free consultation with expert housing counselors who can provide advice, help you find answers and develop an action plan personalized for your situation to get your financial house in order. Don't wait until it's too late.

Contact a HUD-approved housing counselor. They are available 24/7. If you need this assistance call (800) 569-4287.

You can also contact HOPE NOW Homeowners Hope Hotline at (888) 995-HOPE

Visit www.operationrest.org a Christian based non-profit local organization that has a comprehensive guide and senior level assistance.

Should I be Aware Of Anything Else?

Yes. Beware of scams! Avoid foreclosure prevention companies. Solutions that sound too simple or too good to be true usually are.

If you're selling your home without professional guidance, beware of buyers who try to rush you through the process. Unfortunately, there are people who may try to take advantage of your financial difficulty.

Scams aren't always easy to spot – but it helps if you know the warning signs to look for. Here are six red flags to indicate that you may be dealing with a loan modification scammer:

• A company/person asks for a fee in advance to work with your lender to modify, refinance or reinstate your mortgage. They may pocket your money and do little or nothing to help you save your home from foreclosure.
• A company/person guarantees they can stop a foreclosure or get your loan modified. Nobody can make this guarantee to stop foreclosure or modify your loan. Legitimate, trustworthy HUD-approved counseling agencies will only promise they will try their very best to help you.
• A company/person advises you to stop paying your mortgage company and pay them instead. Despite what a scammer will tell you, you should never send a mortgage payment to anyone other than your mortgage lender. The minute you have trouble making your monthly payment, contact your mortgage lender.
• A company pressures you to sign over the deed to your home or sign any paperwork that you haven't had a chance to read, and you don't fully understand. A legitimate housing counselor would never pressure you to sign a document before you had a chance to read and understand it.
• A company claims to offer "government-approved" or "official government" loan modifications. They may be scam artists posing as legitimate organizations approved by, or affiliated with, the government. Contact your mortgage lender first. Your lender can tell you whether you qualify for any government programs to prevent foreclosure. And, remember, you do not have to pay to benefit from government-backed loan modification programs.
• A company/person you don't know asks you to release personal financial information online or over the phone. You should only give this type of information to companies that you know and trust, like your mortgage lender or a HUD-approved counseling agency. Remember: Only your lender can approve a workout plan.

Are There Any Precautions I can take?

Certainly! Here are several precautions that should help you avoid being "taken" by scam artist:

• Don't sign any papers you don't fully understand.
• Make sure you get all "promises" in writing.
• Beware of any loan assumption where you are not formally released from liability for your mortgage debt and contracts of sale.
• Check with a lawyer or your mortgage company before entering into any deal involving your home.
• If you're selling the house yourself to avoid foreclosure, check to see if there are any complaints against the prospective buyer. You can contact your state's Attorney General, the State Real Estate Commission, or the local District Attorney's Consumer Fraud Unit for this type of information.


What Are The Main Points I Should Remember?

Don't lose your home and damage your credit history if you can help it.

Foreclosure can happen to anyone at anytime no matter your income level, education, or even your background. Every hardship situation is unique.

Tabernacle International Church provides this information as a public service. It is not legal advice. Always consult a housing counselor, tax consultant or lawyer before taking action.

We sincerely hope that the information shared today will help you protect the personal and financial investment you’ve made in your home.

God Bless.

Bishop Musser