relief for defaulting borrowers?

There may be some relief coming for homeowner’s who face foreclosure action by their lender. Washington Mutual, Bank of America, Citigroup, Merrill Lynch, and Wells Fargo, received letters asking for a six month moratorium on Foreclosures and instead urging these major lenders in the California market to focus on finding ways to keep borrowers from loosing their homes.

Many thousands of borrowers in California are at risk of default because they took on risky loans, and could loose their homes. Consumer groups, legal aid groups, housing services, at least place some blame on the lenders themselves because of loose underwriting which pushed some borrowers into loans they couldn’t afford.

The Los Angeles Times quoted the associate director of California Reinvestment Coalition as saying “We are asking the largest lenders in the state to take leadership so that families can keep their homes and California’s economy won’t suffer”.

(edit)
as of December 6, 2007 one effort to assist homeowners has been put into place - visit the December 6 posting for details.

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everything you ever wanted to know about real estate but were afraid to ask: Reverse Mortgage

A reverse mortgage is a way to borrow money against the equity in your home to provide you with tax-free income. You can receive funds in any number of ways including:

Lump sum
Regular monthly payments for as long as you live (or reside in your home)
Monthly payments with a pre-determined cut off date
A line of credit to draw on when you need it
or a Combination of these

A reverse mortgage can enable you to enjoy retirement more, provide some financial cushioning for future emergencies or major expenses, while, allowing you to remain in your home and keep title to it. Being more complicated than a conventional mortgage, a reverse mortgage carries some pros & cons and has different qualifying requirements for borrowers. The most notable requirement is that the youngest borrower must be at least 62 years old when the loan closes.

Some other requirements are that the home must be your primary residents and remain so during the term of the loan, and that existing loans, or mortgages be paid off prior to closing on the Reverse Mortgage. (reverse mortgage funds can be used for this according to cash advance rules).

If you choose to, you can even pay off a reverse mortgage early by refinancing out, or just settling up with the lender. If you should pass away before the loan is paid, your heirs can choose to pay off the loan or sell the property, any proceeds above the loan amount of your home goes to your heirs.

applying for a reverse mortgage is easy, and you can start online. The National Reverse Lenders Association website is a good starting point to gather information from lenders. The URL is http://www.reversemortgage.org/ .

Team Results also has a 12 page pamphlet available that covers in detail all aspects of reverse mortgages. We'll gladly mail a copy or e-mail an electronic version at your request. Send requests to TeamResults@Century21.com. Be sure to include your preferred delivery method.



© 2007, John Wall, all rights reserved.