- Mar 19, 2009
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I just lost my place to foreclosure. Since a lot of people are faced with this now, I thought I would post what I have learned to the forum in the hope it might help someone else.
The first thing to do when faced with foreclosure is to just sit tight and dont panic. Then buy the book The Foreclosure Survival Guide. It is published by Nolo and is available from amazon.com. It clearly explains the foreclosure process and details what your options are. Like whether it is to your advantage to try to save the house or if it is in your best interest to just let the bank have it. Also, whether or not to declare bankruptcy at this time. It gives the various state laws and where to find them and where to go for help.
Mortgage modification and HAMP may not be worth it. There was an article in our local newspaper recently about HAMP and how many people who are actually approved for the mortgage modification are far worse off than they would have been without it. I can tell you from personal experience that the banks are not very cooperative with this process and will string you along for months asking you to refax and resubmit the same material to them multiple times. Even if the banks approve a mortgage modification and reduction in monthly payments, they report the loan as delinquent to the credit reporting agencies. This is true even if the homeowner is current on his modified payments. The bank can and often does demand all the back payments due at once, which may be a lump sum of $15,000 to $30,000 or more, and if it is not immediately forthcoming to proceed with foreclosure and the homeowner ends up losing the property anyway.
In all probability you will have several months from the time the bank threatens to foreclose and when you absolutely positively have to vacate the premises. This gives you time to decide what you are going to do and, since you are not making the mortgage payments, to save up some money so you can find another place to live.
In my own case, my husband died, and there was no way I could make the payments without him. Since there was substantially more owed on the place than it was worth, selling was not an option. That combined with the fact that the mortgage company flatly refused to talk to me, and the fact that I did not want to stay here anyway, made my decision to let the bank go ahead and foreclose easy.
I made my last mortgage payment last September, but the trustees sale did not take place until the 6th of June. It is important to know your rights. As soon as the trustees sale was held, my phone was ringing off the hook with people telling me truths, half truths, and outright lies. It is important to remember that legitimate companies in all liklihood will not come to you. You need to go to them. There are companies offering to help you stay in your home for seven months or so for a fee of about $700 per month. Apparently they bombard the bank with paper. About two weeks after the sale I found a three day Notice to Vacate taped to my gate. Since I had a renter, I knew the renter had 90 days before he had to leave. I contacted the exit real estate company and the bank and they proceeded to argue with me. I then contacted my congressman. Whatever he did must have worked because I received a paper from the legal firm representing the bank telling me we have to be out by the 15th of September. Just for the record, a three day notice to vacate does not mean the sheriff will be on your doorstep in three days. It just means if you are not gone in three days they will file a wrongful detainer suit to evict you. You have five days, at least in California, to respond to the wrongful detainer suit. After you respond, the case will then be set for trial, probably within 20 days or so. If you lose the wrongful detainer suit you have a few days to vacate before you can be forcibly evicted. So even in a three day notice, you have about 20 days or so to actually move.
The first thing to do when faced with foreclosure is to just sit tight and dont panic. Then buy the book The Foreclosure Survival Guide. It is published by Nolo and is available from amazon.com. It clearly explains the foreclosure process and details what your options are. Like whether it is to your advantage to try to save the house or if it is in your best interest to just let the bank have it. Also, whether or not to declare bankruptcy at this time. It gives the various state laws and where to find them and where to go for help.
Mortgage modification and HAMP may not be worth it. There was an article in our local newspaper recently about HAMP and how many people who are actually approved for the mortgage modification are far worse off than they would have been without it. I can tell you from personal experience that the banks are not very cooperative with this process and will string you along for months asking you to refax and resubmit the same material to them multiple times. Even if the banks approve a mortgage modification and reduction in monthly payments, they report the loan as delinquent to the credit reporting agencies. This is true even if the homeowner is current on his modified payments. The bank can and often does demand all the back payments due at once, which may be a lump sum of $15,000 to $30,000 or more, and if it is not immediately forthcoming to proceed with foreclosure and the homeowner ends up losing the property anyway.
In all probability you will have several months from the time the bank threatens to foreclose and when you absolutely positively have to vacate the premises. This gives you time to decide what you are going to do and, since you are not making the mortgage payments, to save up some money so you can find another place to live.
In my own case, my husband died, and there was no way I could make the payments without him. Since there was substantially more owed on the place than it was worth, selling was not an option. That combined with the fact that the mortgage company flatly refused to talk to me, and the fact that I did not want to stay here anyway, made my decision to let the bank go ahead and foreclose easy.
I made my last mortgage payment last September, but the trustees sale did not take place until the 6th of June. It is important to know your rights. As soon as the trustees sale was held, my phone was ringing off the hook with people telling me truths, half truths, and outright lies. It is important to remember that legitimate companies in all liklihood will not come to you. You need to go to them. There are companies offering to help you stay in your home for seven months or so for a fee of about $700 per month. Apparently they bombard the bank with paper. About two weeks after the sale I found a three day Notice to Vacate taped to my gate. Since I had a renter, I knew the renter had 90 days before he had to leave. I contacted the exit real estate company and the bank and they proceeded to argue with me. I then contacted my congressman. Whatever he did must have worked because I received a paper from the legal firm representing the bank telling me we have to be out by the 15th of September. Just for the record, a three day notice to vacate does not mean the sheriff will be on your doorstep in three days. It just means if you are not gone in three days they will file a wrongful detainer suit to evict you. You have five days, at least in California, to respond to the wrongful detainer suit. After you respond, the case will then be set for trial, probably within 20 days or so. If you lose the wrongful detainer suit you have a few days to vacate before you can be forcibly evicted. So even in a three day notice, you have about 20 days or so to actually move.
