Residents Attend Free Foreclosure Intervention Forum

A large group of people attended a free forum addressing loan modifications, short sales, and foreclosures at the Biltmore Hotel in Santa Clara on August 10, 2010. Geraldine Barry, founder and president of SJREI (San Jose Real Estate Investors Association), led a panel that included Mike Grey, certified public accountant; Howard Blum, economist; Natalie Nolton, Real Estate agent specializing in short sales; Tony Ventura, Attorney at Law; and a Neighborhood Housing Services Silicon Valley representative.

The goal of the forum was to give current and solid information to people who are in default of their loan, facing a short sale or foreclosure, or are seeking a loan modification because they are having trouble making their mortgage payment.

Since the real estate market imploded in California and banks froze the flow of money to borrowers, undercapitalized homeowners have been victimized; and short sales and foreclosures rose to their highest levels since the depression. In addition, a steady stream of misinformation has compounded homeowners’ problems. To curb the stream of misinformation, government and non-profit organizations are advising people to look locally and seek help from approved HUD agencies, to get solid legal and accountant advice, and most importantly, not pay up-front fees to anyone for a loan modification.

A loan modification is a change or amendment to the terms of the loan and has to be in writing. Getting a loan modification can be a discouraging and tedious process since paperwork often gets lost and it takes months to get a reply from a lender. But since October 11, 2009, after Governor Schwarzenegger signed Senate Bill 94, it is illegal for anyone to collect an advance fee to do a loan modification.

A homeowner looking to do a loan modification should avoid anyone who asks for a fee in advance or guarantees the loan will be modified or a foreclosure stopped, and avoid anyone who advises them to stop paying their mortgage to the bank and pay their mortgage to a third party instead. Read any and all documents before signing them, as some victims have signed over the deed to their home to scammers.

Many things in the housing and loan sectors are changing. For example, homeowners who lost their homes or have ruined credit may be eligible to get financing in as little as twenty-four months after a foreclosure or short sale, and credit-scoring models may soon be modified to help Americans become homeowners again.

HUD approved agencies like Neighborhood Housing Services Silicon Valley offer free financial analysis, free counseling, and free workshops to homeowners experiencing financial hardship.

The staff is multilingual, and they help homeowners create budgets, write hardship letters to banks, and organize financial documents. For a modification, it is important for homeowners to be detail oriented, upfront with their financial situation, and to always speak to the “loss mitigation department” when calling a bank about a loan.

Loan modifications may take between 3-4 months for people who follow instructions. Make labels with your name and loan modification number and stick a label on every page the bank requests before emailing or faxing financial information.

For loan modification guidance Call 1-888-995-HOPE (4673). Other websites to visit for information on loan modifications: www.fanniemae.com, www.freddymac.com, www.LoanScamAlert.org, www.makinghomeaffordableprogram.gov, www.LoanScamAlert.org, the lenders website.