In Los Angeles, two thirds of the families facing foreclosure who walk through the doors of our HUD-approved housing counseling agencies have been scammed by so-called mortgage modification consultants. These consultants promise the world to vulnerable homeowners desperate to stay in their homes, charge advanced fees as high as $5,000 and then take the money and run.

Today, I took a big step in increasing the resources that homeowners need in order to combat loan scams and foreclosure fraud. I announced the start of NeighborWorks America’s national campaign against loan modification scams. I stood with Eileen Fitzgerald, Chief Operating Officer of NeighborWorks America, to deliver this simple message to Angelenos and the rest of country:

1. You don’t need to pay for a loan modification.
2. If you are facing foreclosure, there are HUD-approved housing counseling agencies ready and able to assist you FOR FREE.
3. If a deal sounds too good to be true, it is!

I was honored that NeighborWorks America chose Los Angeles to launch this valuable campaign. Over the past two and a half years, more than 28,000 Angelenos have fallen victim to foreclosure. That’s 28,000 friends and neighbors who lost their homes and their stake in the American dream.

Over the past year, we have worked tirelessly to get the message out about the dangers of loan scams to our residents. In fact, in this crisis, we were the first city in the country to ban mortgage modification consultants from charging advanced fees.

Seattle is part of this!

It’s high time that elected officials, non-profit organizations, and banks work together to shut the door on loan scams and foreclosure fraud once and for all.

As they say, forewarned is forearmed. By giving our homeowners credible information and directing them to reliable resources, we can beat these scammers! To report a scam or to spot a scam, homeowners should go to the NeighborWorks campaign website, or call 1-888-995-HOPE. 

Hope Now:  www.hopenow.com

Antonio Villaraigosa

Mayor of the City of Los Angeles

Read more at: http://www.huffingtonpost.com/antonio-villaraigosa/fighting-loan-modificatio_b_334752.html

October 26, 2009

Post from: The Mortgage Reel - Seattle Real Estate Preferred Correspondent Lender

Fighting Loan Modification Scams

Timothy Geithner has announced further assistance to help distressed homeowner prevent foreclosure.  First step is for lenders to offer loan modifications.  If the modification is not possible, a quick private sale is encouraged.  The last resort will be a modified short sale process.  This will save homeowners money and protect their financial future. 

All the steps taken will help stabilize the market and lead towards the housing recovery. 

The new program being introduced with Making Home Affordable will be a simple short sale process.  Borrowers, who are eligible for a Home Affordable Modification, but do not qualify within the modification guidelines or can’t maintain the payments during a trial period. 

A short sale is a homeowner’s last resort before foreclosure if a loan modification is not available.  Short sales protect homeowners from damaging credit and saving money for the owner and lender.  On average a short sale costs 50% less then a foreclosure. 

The new program should simplify the short sale process to prevent the high rate of short sales that fall apart in today’s market.  On average the banks sit on offers made to purchase the home for 60 – 90 days and property values can decrease or the property remains vacant and can be vandalized.  Also if there are first and second lien holders with different lenders, they argue over how much compensation each will receive.  Most situations they do not come to an agreement allowing the purchase offer to fall apart. 

If a short sale falls apart, the owner gives up the key which is called a deed-in-lieu. 

Under the new program mortgage servicers will receive monetary incentives for a completed short sale transaction.  Both first and second mortgage lien holders will receive incentives.  This creates excitement across the housing industry, increasing motivation to help troubled homeowners.

Post from: The Mortgage Reel - Seattle Real Estate Preferred Correspondent Lender

Banks Receive Incentives to Help Distressed Properties

Are you currently facing financial difficulty in making your monthly mortgage payments?

Have you fallen behind or will soon? 

Have you applied for a loan modification and received no help?

If you would like to sell your home prior to foreclosure you should speak with a short sale specialist today.  Act now and see what options you have before it is to late!!

Moose Math

Short Sale Specialist

John L Scott

206.227.2700

moosemath@johnlscott.com

 To clearly understand what is a short sale:

You are currently behind on your mortgage payments and your current principal balance is $200,000.  Because of the current real estate market your home is valued at $175,000.  In a short sale the lender agrees to take the $25,000 loss. 

The bank will or will not approve this.  You as an owner might agree to take $175,000 because that is the market value but the bank ultimately has to approve the deal. 

Short sales are becoming more and more popular, but the key item is to act as soon as possible. 

Post from: The Mortgage Reel - Seattle Real Estate Preferred Correspondent Lender

Seattle Short Sale Information & Assistance