Not being able to pay your mortgage is an experience that 95,349 families and individuals throughout the U.S. have been dealing with in the foreclosure filings during the first quarter of 2024 according to ATTOM.COM, a leading curator of land, property, and real estate data.
This is a 3% increase from the previous quarter, but down less than 1% from a year ago. However, March 2024 showed 32,878 U.S. foreclosure filings up 3% from the previous month but down less than 1% from the previous month and 10% less from a year ago.
Those major metro areas with populations of 200,000 or more that had the largest numbers of foreclosure starts in the first quarter including NYC, NY (with 4,404 starts), Houston, Texas, (with 2,977 starts), Chicago, Illinois(2,867 starts), Los Angeles, Ca.(2398 foreclosure starts), and Miami, Fl.(2319 foreclosure starts). The highest foreclosure rates were in Delaware, New Jersey, and South Carolina.
Some may not be aware of other ways to keep foreclosure from happening or at least to stave off the process, providing enough time to recoup and recover and to do what is necessary to increase their incomes with a 2nd or 3rd job or side hustle and stabilize their situation.
I do understand that it is by far a very stressful and worrisome event and it’s not easy to deal with when having to confront what to do and in which direction to head. Losing one’s home is life-changing, but taking a positive attitude and doing what is necessary will hopefully allow you to see the light at the end of the tunnel.
The first thing one should do is sit down, try to relax, clear your head, and create a plan (as I always say if you “fail to plan, you will plan to fail”).
I am sure you would prefer to stay in your home and not have to move, as this has been your familiar space, whether short or long term and feel most comfortable to continue living in your own home.
As I mentioned, finding and securing new and additional income should be one of the first steps in being able to continue paying your mortgage. However, simultaneously, communicating with your lender should be tantamount in finding solutions to be able to stay put.
You will need to ask a loan representative if a modification of your loan can be considered with a lower interest rate and/or payments. If this is possible, the bank will most likely add the unpaid interest and whatever principle is owed to the back end of your mortgage. Most important try to make sure you ask for the name and I.D., extension, or direct number of the person that you initially converse with.
This should be the go-to individual that you want to always speak with. Developing a bit of rapport will be most helpful in your situation, as they are human too and may have dealt with the same situation on a personal level as you, as well as with others who are experiencing the same circumstances.
I have assisted several people, by interceding in the negotiations with the homeowner providing me authorization to speak on their behalf.
The timing and approach will be crucial in allowing you more time to strategize and work out your plan. However, you should have an idea going forward in advance of getting behind in your payments.
Keep in mind when you are 3-4 payments behind, you will now be in lis pens, heading towards foreclosure. Your credit will be impacted once you are in this position. You must have constant communication with your bank and especially since that one representative with whom you have begun to build rapport and somewhat of a relationship.
From my experience in dealing with foreclosures, sometimes it is a long road to remedying and rectifying your mortgage issues. Luckily in NYS, I have seen some homeowners stay in pre-foreclosure for up to 7 years; sometimes saving so much money, that they are almost able to pay cash for another residence, depending on where they live.
This isn’t a normal occurrence but can sometimes happen. Having a qualified attorney to assist you will provide the extra cushion of time to hopefully get your finances in order and stave off foreclosure.
Following this path and contemplating what to do but not see any way out, then selling would be the most logical path to pursue; while you are still in control of your home and hopefully have a good amount of equity that you will be able to take with you.
Don’t procrastinate for you should have a timeline to know when will be the most advantageous time to sell by getting a Realtor to assist you. In some ways, time is somewhat on your side, but don’t wait too long.
Your bank would rather not foreclose on you, as it is a costly undertaking, as much as $50,000 plus and if you are being represented by an attorney, it could cost you $300-$500 per hour; unless a flat fee is discussed and negotiated.
It is in your best interest as well as the bank’s to somehow and someway to discuss, negotiate, and formulate a way to keep you in your home. If possible, working out a lower rate and/or monthly payments could be the solution.
You need to take the right attitude in conveying your commitment to agree to a solution and begin making your payments.
Lastly, during the process, stay in touch with your lender and make sure you return all calls. This will bode well in doing what is required and necessary, as it will show your lender that you are taking full responsibility in needing and wanting to stay in your home. I wish all who are having financial issues good luck.
If you need any advice or a consultation, feel free to reach out to me at anytime.
Philip A. Raices is the owner/Broker of Turn Key Real Estate at 3 Grace Ave Suite 180 in Great Neck. For a free 15-minute consultation, value analysis of your home, or to answer any of your questions or concerns he can be reached by cell: (516) 647-4289 or by email: Phil@TurnKeyRealEstate.Com or via https://WWW.Li-RealEstate.Com
