OfflineOver the last few years, there has been a variety of foreclosure settlement agreements that were designed to help compensate wrongful foreclosure victims and encourage lenders to seek alternatives to repossession, such as home loan modifications.
Despite the agreements, there have continued to be complaints about unethical actions from lenders, including lying to homeowners in regards mortgage modifications and intentionally pushing these struggling homeowners into foreclosure.
With lenders having very little oversight and those facing the possibility of losing their homes having to rely on these banks to help them settle their mortgage issues, there is no wonder that mortgage modifications and other efforts to avoid foreclosure have been less than successful over the years.
Fortunately, mortgage modifications are finally increasing as foreclosure starts are declining.
- See more at: http://www.bankforeclosuressale.com/wp/article-08264413.html#sthash.3szP...
http://finance-commerce.com/2013/08/california-city-looks-to-seize-loans...
Just thought I would add comments about working with people who are in financial difficulty with a property that could precipitate a short sale. Another approach would be to have them apply for a loan/mortgage modification. Steps are simple:
1) First, secure either an option to purchase or contract to purchase the property, subject to approval by seller's lender.
2) Have the seller apply for a loan modification immediately.
3) If the modification is accepted, you can take possession of the property on a "Subject to" (Wraparound Mortgage/AITD), or add an addendum to the purchase contract that converts it into a land contract. You will have control of the property, and the lender will have agreed not to foreclose on the property as a part of the loan modification, as long as there is no further default on payments.
Note: here is a link to an article on "11 Essential Loan-Modification Tips" that contains some helpful ideas on negotiating loan mods.
http://realestate.msn.com/article.aspx?cp-documentid=20589023
Dallin Wall
Real Estate Training Team
Forum Blog Location--A collection of my
"Best of" posts:
http://www.deangraziosi.com/blogs/dwall