Government Takes Steps To Help Foreclosure Victims
In mid-August, the federal government took the first meaningful steps to provide aid for victims of the mortgage foreclosure crisis that has been sweeping the United States this year. The goal of the new initiative is to help more American families keep their homes by providing an alternative not previously available.
The new foreclosure prevention initiative, called FHA Secure, is administered by the Federal Housing Administration (FHA) and is a mortgage insurance program for borrowers who have good credit but have still fallen behind in monthly payments due to resetting interest rates that increased those payments significantly. Under the terms of this initiative, the FHA can offer homeowners and affordable option that permits them to refinance their existing mortgages and make payments. This program, along with other FHA programs, will provide important help to more than 240,000 families. The target for the initiative is families who could lose their homes due to the unavailability of refinancing options.
In addition, the FHA has 2,300 approved housing counselors nationwide and has increased funding for housing counseling by 200% since 2001. The Department of Housing & Urban Development (HUD) announced more than $44 million in grants for new housing counseling grants to more than 400 state and local programs.
It is the government’s contention that many US consumers must be educated because many don’t read or understand their loan contracts and some don’t even try. The key here is to teach people how to read the ‘fine print’ in contracts before they commit to terms and conditions beyond their financial means and also when they should ask for assistance. President Bush has also asked Congress for an additional $50 million for housing counseling as part of his new budget.
It appears that federal and state authorities have finally taken some firm steps to halt the growing mortgage foreclosures and housing industry slump that might be the beginning of a recession. Officials have also reached out to groups that offer foreclosure prevention counseling and refinancing assistance through a program called HOPE NOW, a private sector alliance to help more people keep their homes. This is a ‘partnership’ that includes many large mortgage servicers, housing counselors, investors and trade organizations committed to expanding mortgage refinancing options and helping homeowners to understand loan agreements before bad things take place.
Given these steps, it appears that the US government has finally taken some firm actions to help. For many homeowners, however, it comes too late.
Some state governments are taking similar steps to aid their homeowners caught-up in the mortgage foreclosure crisis. In Michigan, for example, there is a proposal to make loans available through the Michigan State Housing Development Authority to permit qualified borrowers to refinance their mortgages at lower rates, thus avoiding the huge increases from the resetting of adjustable rate mortgages.
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My mortgage company has put my house in foeclosure because I was behind 5 payments. I sent them all 5 payments on March 27,2008 priority mail this was befor the end of the 5th month. They claim they never recieved it and post office claims they dont have it either. In the mean time I had not recieved any letters or notices to the fact that they were forcloseing. I was not giving any chances to try and fix this matter. I have a FHA loan what can I do about this?
Mark,
The best thing for you to do is to check to see if those funds you tried to send are still in your bank account, or wherever you had them. If so, cancel the check or money order you sent via mail. After you have done that, call your lender and ask for the “Loss Mitigation” or “Home Retention” department. When you talk to them, they will tell you exactly how and where to pay the payments. These departments are the only ones authorized to stop your foreclosure.
Hope this helps,
Kevin