Special Report

STOP FORECLOSURE!

If you are behind in payments or about to get behind on your mortgage, you do not have to destroy your credit.

You really do have options.

But YOU need to act fast. Read carefully this report and try to save your credit and your home from an even uglier situation.

The intent of this report is to examine alternatives to foreclosure. Amidst this terrible financial and emotional dilemma, you need to try to surround yourselves with trusted people who can look out for your family.

And you also need the best solution for your family, hopeful that your decision will achieve what's important to your family.

Please do not simply listen to the first stranger who sounds very caring and trustworthy.

Do you have a pastor?

Do you have friends and family with whom you can discuss this situation?

The most important advice is not to give up!

First, let's examine some of the options that you have to address your problem and go over some of the possible ramifications.

***Disclaimer*** I am not an attorney or CPA and I don't give legal or accounting advice. I simply want to help you stop foreclosure by helping you to see what options exist:

1.This option is quite obvious. Make up back payments. If you have the money, the absolute easiest solution is to write a check to the mortgage company to make up the back payments, late fees, and legal expenses.

2. Get a "hard-money" loan. IF you have at least 65% LTV, i.e. your home worth $200,00 on which you have a mortgage for $130,000, you may consider calling a hard-money lender. Where are they? Look in the Real Estate section of your local newspapers. Beware, these lenders charge hefty fees, generally 12% interest and 3-5 points, i.e. 3-5% of the loan amount, paid upfront for the privilege of lending you money quickly.

This should only be considered as a final resort and <if> you understand the terms.

3. Sell to an investor. You've seen the "We Buy Houses!" signs and ads in the newspapers. They're everywhere. Call as many of the investors as time permits. Interview them. Find out if one of the investors can provide you with a win-win solution. However, do NOT sign anything until your attorney has reviewed the paper and given you his/her opinion.

Yes, I understand you're behind or about to get behind in payments. You are talking with the lender, aren't you? That may very well "buy" you a little extra time.

That extra time is necessary in order to choose the best solution for your family and you. You do want to be prompt with your decision, but you do NOT want to rush in to something perhaps even worse than foreclosure.

4. Negotiate with your lender. Faced with a "non-performing asset," a lender MAY restructure your payments. To stop foreclosure, many lenders will negotiate a deal with you to take what you owe them and pay it over a few months IN ADDITION to the normal mortgage payment. This option may only prolong the inevitable, if you are not able to afford the increased monthly payment, i.e. regular monthly payment + portion of back payments.

5. Restructure Your Mortgage. If possible, call your lender to discuss your options. If restructuring your mortgage is the best solution for your family, discuss this option with your lender. Your lender may take what you owe and add it to the end of the mortgage in the form of additional payments to stop foreclosure. Depending on how the mortgage is restructured, the interest rate and/or the payment could go up. And you're most certainly going to have to "prove" to the lender that the condition resulting in this situation is resolved.

6. Refinance to stop foreclosure. Discuss this option with your lender, <if> you have enough equity or if you originally had a 15-year mortgage. This option could actually lower your payments!

7. Stop foreclosure with an equity/line of credit loan. If you have a line of credit with your bank or if you qualify for a home equity loan, either of these options may give you the cash you need to bring the mortgage current and stop foreclosure. Once again though, be sure to evaluate whether or not you will be able to afford payments that will be higher than the ones that caused you to get behind.

8. Stop foreclosure through a Debt agency. You've seen them on TV; you've seen their ads in newspapers. "Bring us all your debt, and we'll negotiate with your creditors to stop foreclosure and lower your payments!" Some of these agencies are great and will help you stop foreclosure; others will help you for a hefty fee and at the expense of your credit for the next 5-7 years. BE CAREFUL!

9. Bankruptcy. Consult an attorney to stop foreclosure. In October 2005, new laws went in to effect regarding bankruptcy. Read about the changes to filing bankruptcy. If you're able to file bankruptcy, this may be the best option.

10. Get Help From a Friend, Relative or Charity. Some charities or government organizations will give you the money to bring your mortgage current and stop foreclosure if you can prove to them that it won't happen again. If you're very lucky, some relatives will offer to do this as well.

11. Deed in lieu of foreclosure. Some lenders will allow you to give the house back to them in order to stop foreclosure. Please discuss this option with your lender and an attorney before choosing this option. You need to understand the ramifications. As you understand, a lender is not obligated to accept your deed and forgive the remaining balance of debt.

Despite receiving your deed, the lender CAN and MAY go after you for any unpaid balance once the lender sells your home (generally for a drastic discount in order to remove this "non-performing asset" from the lender's books).

12. Legal Proceedings. Your attorney may be able to stop foreclosure for quite some time by flooding the mortgage company with legal proceedings.

13. List with a Realtor or Sell as a FSBO. FSBO = For Sale by Owner. Is the housing market fairly hot in your area? How many days is the "average" home sitting on the market before selling? Call a realtor to find out.

Do you have enough equity to sell BELOW market to get a quick sale? Does your equity also provide enough for all the fees involved in the sale of your home?

Typical fees on a home selling below market at 90-95% of FMV or $200,000 include:

1. $ 10,000 - 12,000 Realtor's Fee (5-6%)
2. $ 2,000 - $4,000 Transfer Tax
3. $ 2,000 - $4,000 Seller's Title Insurance Policy
4. $ 1,500+ /month Holding Costs (During escrow, you're still paying HOA fees, property taxes, electric, water/sewer, and you're expected to pay any back payments + fees).

Not including any miscellaneous closing fees, you have drastically reduced the price of your home to get a quick sale. However, to sell you will lose an additional $15,500 - $$$$ for selling costs.

Your task is to determine your family's priorities and to choose the option best matching your family's needs.

Time is of the essence. Honest, straightforward people will try to help you if you'll give them a chance.

Not everybody is out to take advantage of your hard times. Hopefully, you have good health, a loving, supporting family and friends, and the hope for a brighter tomorrow.

Best wishes.