Why Foreclosure Has Become So Common

For years, most people assumed that foreclosure only happened to the "other guy." And in truth, foreclosure was a rare problem.

Today, foreclosure is happening to people at every economic level.  In fact, many middle class families, who otherwise pay their bills and manage their money carefully, are shocked to discover that they may be forced to go through foreclosure and lose their good credit rating.

Why is this happening?

While it is true that a few homeowners have taken on more than they can afford, in most cases, the struggling economy has created the problem.

For one thing, American jobs have been going overseas for many years.  Cheap labor in other countries encourages U.S. companies to export their work force, including management and middle management positions.  Layoffs, forced retirements, and salary cutbacks can play havoc with your budget and turn a previously affordable home into a financial liability.  If you are a two-earner family, you can be devasted when one person loses a job.

Then there are unfortunate situations, such as divorce or injuries on the job which often create financial hardship.  In the case of an injury, you could be out of work for weeks or months with a little or no pay.

To make matters worse, lenders seldom have programs in place to help their customers.  They may have a gladly collected a fortune in interest, but when you miss just a few payments, they will begin the foreclosure process without hesitation.

Your Lender May Not Be Able to Help

When you have financial difficulty, your first reaction may be to refinance your home or make an adjustment in your laon, often called a "loan modification."  That sounds good in theory, but in today's economy, there are serious problems with this idea.

The reality is that lenders are not in the business of losing money, so they are not set up to help you when you are in a tight financial spot. And to be fair, most people who face foreclosure today have other financial issues, such as credit card debt or medical bills, or they have just lost a job and lack the income to qualify for a new or modified loan.

Sometimes even when you are talking to your lender, you can get bad advice that will make your situation worse.  For example, your lender may tell you that you can modify your loan, but only after you are 60 days late on your payments.  So stop making payments get far behind, then something unexpected happens that forces your lender to foreclose.

PROGRAM HR3648 is a privately sponsered, nationwide initiative to reach out to homeowners who are struggling with their mortgage payments.  It provides you with the information, guidance, and services required to avoid foreclosure and minimize the impact on your credit rating under the rules enacted under The Mortgage Forgiveness Debt Relief Act.

Certified Program HR3648 Specialists (CPSs) volunteer their time to assist as many homeowners as possible.  All services provided by Program HR3648 are free for every homeowner.  There are no costs or fees of any kind for these services.

If you qualify for the program, you and your CPS can mutually decided on the option that is best for you. 

 Want the help you need?  Contact us today:

540-220-1869 or 540-429-5073