How Far Behind Do I Have to Be For Mortgage Forbearance?

How Far Behind Do I Have to Be For Mortgage Forbearance?

Under normal circumstances, there are policies owned by all lenders, and that is what you should be working with. However, if you are finding it difficult paying you mortgages either due to lose of job or increase in costs. There is a 15-day grace period, and if you are able to meet up and make payment, you are all good but if you happen to miss your second payment, it is said that you have defaulted and you should expect a change in your mortgage servicer.

Once you have noticed that you won’t be able to meet up with your payment, it is advisable to contact your lender and discuss mortgage forbearance.

MORTGAGE FORBEARANCE

This is an official agreement between the home owner (you) and the lender, if for any reason you are unable to pay your monthly mortgage amount. Your payment requirements will be frozen by the lender for a period of time. After the agreed period elapses, you are expected to continue your normal monthly payments and you will also pay back all balance owed, including all interests gathered during your grace period. This sounds like a great deal especially to those who have lost their jobs during this Coronavirus crisis, it helps you skip some or all of your monthly mortgage payment for as much as a year. But it should be considered as your last resorts, and should be avoided if possible because while it can be a life line for a short period, it will undoubtedly lead to credit issues.

More: Is Mortgage Forbearance a Good Idea?

HOW TO WORK WITH YOUR LENDER TO GET FORBEARANCE

STEP 1: REACH OUT

Contact your lender and inform them about your present crisis financial state. Some of them have online chat options or a forbearance form you can use also. Some key information and documentation will be needed by your lender, so be prepared to provide these:
• An outline of your financial state, also the cause of the financial issues and when you think all be fixed back to normal.
• Mortgage loan or your account number
• Your monthly income before taxes
• Monthly expenses clearly itemized

Remember, that your lender wants you to keep your home and keep paying your mortgage so they will do their best to help, don’t be afraid to ask for help.

STEP 2: REQUEST

The lender must follow some steps before granting you the forbearance agreement. They might ask you to make some deductions on your monthly expenses, if they notice some things that are not needed on your list; you should be able to explain to them why those things cannot be removed from your list, you will also prove that you are making efforts to get a new paying job.

STEP 3: SUBMIT

Your lender will want to confirm your financial crisis, provide them with your unemployment verification letter with detailed information. Follow up your lender until a negotiator or loan officer is assigned to your account, which you will work with till the end of the process.

STEP 4: WAIT

After you are assigned with a negotiator, you have to wait for approval, sometimes it takes several weeks but ensure you follow up with your negotiator to show that you are serious with your request.

STEP 5: RECEIVE

Once you are approved, a letter with detailed terms of the agreement will be drafted by the negotiator, with the forbearance period time frame, amount to be paid during that period, the interest rate of the amount owed and how to repay the outstanding balance after the period.

STEP 6: SIGN AND RETURN

If you are satisfied with the terms, sign the agreement form and return to the lender. Your forbearance period has commenced after submission. After this period your payments return to normal, with an additional payment to cover your outstanding balance.

Assuming you fail to meet up with the terms of forbearance, your home will likely go into foreclosure. This is the last step before you lose ownership of your home.

For legal advice and consultation,  as well as information regarding mortgage modification or mortgage mediation services Please give us a call for a free consultation to discuss your specific financial challenges during this difficult time. You can reach us at 425-452-9797 

 

How Do I Know if I Qualify for Mortgage Modification?

How Do I Know if I Qualify for Mortgage Modification?

Surprisingly most people in Washington state don’t even realize that they can qualify for a mortgage modification or mediation. Mortgage payment each month is causing you more and more stress or you’re simply not able to make the payment, there are options. Washington state has Washington State Foreclosure Fairness Act, which was implemented several years ago helps Washington homeowners modify their existing mortgage in order to stay in their home.

Like to stay in your home there are options but there are also qualifications. Banks will not tell homeowners that there are options oftentimes considered a better “dirty little secret”. Banks have not financially incentivized homeowners to modify their loan in most cases, and this is where a mortgage lender needs to come into play. Homeowners cannot modify their own mortgage unless the letter asking for a straight refinance. Often, homeowners that are already struggling making their mortgage payment cannot qualify for refinance. This is where attorneys such as Advantage Legal Group can come into play. Attorneys or housing counselors must modify and mediate the mortgage refinance or modification on behalf of the homeowner. This really is the only caveat and can be difficult for a lot of homeowners to understand. Often get asked why they cannot simply go to their bank and ask for modification on their own. But with Washington State Foreclosure Fairness Act, there is a moderator on behalf of the homeowner that can handle and facilitate the moderation between the homeowner and the bank.

The downside is that the only way to qualify is to actually stop paying your mortgage. While this is often the case for a lot of homeowners, some may find it difficult to do so without food and utilities in order to make the mortgage payment. This is where the moderator needs to step in and provide alternate options. Once the homeowner is unable to pay and this is a payment, they can trigger events under the current law which provides the homeowner an option to elect to enter into mortgage mediation. The homeowner will receive the “Notice of Pre-Foreclosure Options” and after this will have 30 days to respond to elect to request a meeting with the bank in order to discuss the situation, however, this must be done with a moderator as in a housing counselor or attorney. You can meet with the bank on your own but homeowners cannot request mortgage mediation by themselves. This mediation can only be requested through a HUD counselor or mortgage mediation attorney.

(See How Advantage Can Help You)

If the homeowners do not want to enter into the mortgage ocean the bank will usually proceed to the second notice, “Notice of Default” 90 days after the issuance of the first notice. At this point that you can still request mortgage mediation but must be negotiated by the HUD counselor or an attorney. After notice of default is an issue they post the third notice, “Notice of Trustee Seller”. This is if the homeowner has not requested a modification. The bank will continue on the foreclosure without the homeowner does something to stop it.

  • In order to qualify the homeowner must complete the package for loan modification including submitting paycheck stubs, budget, documents that the loan servicer requests and a hardship letter stating why you are unable to make their mortgage payment.
  • The property must be the primary residence, meaning it cannot be an investment or rental property.
  • Homeowners to choose modification if they are unable to refinance. Allows a temporary briefing room to get through financial hardship.
  • Homeowners must also have adequate debt to income ratio. Lenders prefer as low as 36% but can go as high as 45%.

If you’re concerned you may not qualify contact Advantage Legal Group today to discuss your options! You might be surprised at how affordable a mortgage modification really is, even through an attorney. And of course, you’ll have the peace of mind knowing you can keep your home.

Contact them today!

Don’t Go it Alone – The Washington Fairness Foreclosure Act

Don’t Go it Alone – The Washington Fairness Foreclosure Act

There are still many homeowners facing foreclosure. For the last three years, Advantage Legal Group has been doing much to inform those homeowners about the hope they may have in the Fairness Foreclosure Act. Their efforts have been pretty successful and they’ve saved the homes and lives of many clients. However, now there’s a new thing to make people aware of…the danger of trying to do it yourself.Don't Go it Alone - The Washington Fairness Foreclosure Act

There are people who do indeed know about the Washington Fairness Foreclosure Act but instead of obtaining a lawyer to or credit counselor to request mediation, they try to request it themselves only to be turned down time and time again, all the while, racking up additional fees each time they try. These fees WILL eventually have to be paid somehow, and these people may now face the reality of losing their homes AND paying the fees!

Related: The Ultimate Home Sellers Guide

Save yourself a lot of time, heartache and money!

Save yourself time, heartache and money by getting yourself an attorney or credit counselor to set up the mediation for you. You cannot go it alone. These people keep getting turned down for mediation because homeowners can ONLY be referred to foreclosure mediation by a housing counselor or attorney. The counselor or attorney will determine the homeowner’s eligibility for mediation and may make a referral on their behalf to the Department of Commerce for foreclosure mediation. Eligible homeowners will then be assigned a mediator by the Department of Commerce to conduct the foreclosure mediation process that has been established under the Act. Additionally, although not required, the homeowner may also benefit from having the counselor or attorney present during the mediation to assist/represent them during the process. The lender is also usually represented by their own lawyer.

Contact Advantage Legal Group for all Foreclosure Legal Advice, Mortgage Modification and Foreclosure Defense 425-452-9797

Bellevue Foreclosure Defense

Bellevue Foreclosure Defense

Hi, my name is Jonathan Smith and I am an attorney servicing Western Washington. My law firm does mortgage mediation, mortgage modifications, bankruptcies and short sales.

Updated: 5/18/2020

Right now with the current pandemic, homeowners may be fearful of losing their homes due to foreclosure. If you’ve been out of work and unable to either get employment or just not enough to make your mortgage payment, foreclosure may be on the horizon. It’s extremely important to act now and as quickly as possible to avoid foreclosure.

Foreclosure defense is the legal strategy initiated by a homeowner to avoid foreclosure. The simplest way is to simply modify the mortgage but the homeowner may not be able to do this alone with their lender. They may need a foreclosure defense attorney to renegotiate the terms of the mortgage in order to make the payments more affordable or put off the payments for a couple of months.

In several cases, homeowners can successfully contest foreclosure proceedings with the help of a foreclosure defense attorney. We help homeowners find legal grounds on which the proceedings can be challenged. In rare cases, mortgage companies have filed foreclosure proceedings illegally.

We are offering foreclosure defense services, which use all of the above to attempt to avoid foreclosure, if at all possible. The single worst impact on your credit is a foreclosure. It’s far better to have either a short sale or some other disposition of the property, or a mortgage modification or a mediation – than it is to have a foreclosure.

We are offering services to help you work out the best methodology for dealing with your current situation. If that’s something that interests you, check out my website at AdvantageLegalGroup.com Again, AdvantageLegalGroup.com. And I look forward to meeting you.

Foreclosure Defense options may include Mortgage Mediation, Mortgage Modification, Short Sale or Bankruptcy.

Contact Us Today at 425-452-9797 or Below

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