Can anything be done for a house moving toward foreclosure with liens?

**realestate360** · 03-02-2008, 08:33 AM

I recently spoke with a gentleman who's house is going up for auction in a matter of days now. He said he's been back and forth with the mortgage company for months now, and they will not allow any more extensions. He also cannot sell because there are substantial liens on the home (he claimed these are higher than the home's value by more than $100,000). Furthermore, his wife is unwilling to make a decision, so they have not explored leasing or renting the home out in order to make payments until they could sell.

Is there anything that can be done in such a situation? Perhaps now is too late, but is there anything he could have done up to this point that would have made a difference (even with the uncooperative wife)? His is an interesting but heart-wrenching case. Perhaps there is some kind of guide or counsel for folks who have homes headed toward foreclosure? I'd hate to think that the world is so focused on money that there is no help for folks in this situation...

-Real Estate 360[SIZE=-1]

**carlam** · 03-03-2008, 04:58 AM

There are so many homeowners that are facing foreclosure, it is very unfortunate! Most people don't want to talk about it, until it is too late!

Maybe the liens could have been negotiated to accept a portion of payment just like a second mortgage in a short sale? In order for a bank to sell a property once they own it; there has to be a free and clear title so it needs to be addressed by someone. This problem requires an attorney to straighten out.

**PPP** · 03-03-2008, 05:10 AM

An interesting post that raises some good points. I'm afraid I can't offer any practical suggestions but it did make me think.

Recently there was a BBC documentary about some of the victims of the crash in the US subprime market and "heartrending" is just the word.

Perhaps what is needed here is an image overhaul. Of course it's shameful to admit that you cannot make payments any more and your house is going to be repossessed, but considering the current economic climate I think there are going to be many more people in this situation. Something should be done to help remove the stigma and show people that it's okay to get help. It's okay to admit that you have problems.

Looking at people going through similar issues where I work I know that banks are willing to listen and will try to work out a solution if at all possible - they're not just in it to grab the house and run.

Of course something is bound to go wrong when too much money is lent to people who cannot afford to repay but it's a little late for coulda woulda shoulda.

We have to remember that real people are involved and that the loss of one's home must be a traumatic and devastating experience. And it can happen to anyone.

**vbenitez** · 03-03-2008, 11:35 AM

There is a program for owners that are having hardships after there interest rate adjustment. I believe it's called FHA Secure 97% LTV. I think that the owner has to apply within 30 days of the hardship. Does that make sense? They have to have been on time with all of their payments prior to the adjustment to qualify. That's about all that I know about it but it may help someone else in that type of situation. Maybe they can do their own research on the program.

**realestate360** · 03-03-2008, 01:32 PM

Thank you all for the comments and suggestions. From what I understand, there was a second mortgage taken out with an adjustable rate, and this is where the problems began for him. This new situation only slightly lowered his monthly payments, and within a few months he was back to not being able to pay on time.

When I spoke with him, it wasn't quite the end of Feb. yet, but he explained that he had only until the 4th of March, which is unfortunately tomorrow. I wish there is something more I could have done or suggested, but I only found this forum and thought to ask about his situation a few days ago. I will suggest the program that was mentioned, though I don't think he'll qualify as it seems like it's been longer than 30 days and I don't think he was on time with payments before his adjustment.

I think you're right, PPP. More and more people will face situations like this in the current market. There really ought to be more programs to help folks in these situations. I heard of a newer program recently being initiated by the President, but I don't know at what point in the foreclosure process a person would have to be to qualify or be able to benefit.

Perhaps it is too late for this gentleman, but it goes to show you that our country seems to care little about these kinds of hardships IMHO (or else there would be more plans or programs in place to help people, more preventative help or something). Perhaps if citizens of this country could get a break on other necessities like health care and education (like many of our neighboring countries do), there would be fewer issues with foreclosure and repossession...

-Real Estate 360[SIZE=-1]