I Am Upside Down, Now What? [Part 2]

I’m upside down, now what?

In part 1 I went over the the sense of entitlement some home owners may have due to their declining property values yet have no financial hardship. In today’s part 2 I’m talking to those who are facing financial difficulties .

There has been much talk following the housing collapse about who’s to blame in all of this. The banks for their risky mortgages, loan officers which didn’t explain loan documents to borrowers and the buyers them selves taking out loans they knew they couldn’t afford.

Regardless of who is to blame for your situation, the fact of the matter is that we’re here today and you are strugling to make your payments.

Navigating this situation can be very stressful and some may be too embarassed to share with others. Many feel ashamed and hold them selves responsible for not making wise descisions and being able to take care of their family.

I want you to know that there is nothing to be ashamed of. The housing market will always have ups and downs yet no one can figure out the timing of it all. With the downturn in the economy many people have lost their jobs, suffered pay cuts or reduced hours, all diminishing their ability to continue making payments on their high priced mortgage.

So what to do?
Get informed: the first thing is to figure out what your options are. Ignoring the problem will not fix it but only make it worse. There are many free resouces to get educated on the matter.
When facing foreclosure there are 6 ways to prevent it from happening, loan modification, short sale, deed in lieu, forebearance, cure debt and bankruptcy.
Each have their pros and cons as well as qualifications to be eligible.

As a real estate professional I’ve naturally assisted many more home owners with their short sales than any other. For short sales, home owners must provide a letter stating their financial hardship in order for the lender to approve the short sale and release the home owner from the loan.This includes: loss of employment, divorce, interest rate adjusted, reduction of income…

Please be aware that there are many scams involving foreclosure prevention.
When dealing with someone make sure he is licensed by the California Department of Real Estate, you can verify this on their website: http://www.dre.ca.gov/cons_complaint.html

It is illegal in the state of California to charge upfront fees for their services!
If some one has asked you for money to begin the process chances are it’s a scam.
The key here is information, knowing where to turn for advice. You should seek the help of government groups such as HUD or FHA. Should you know a real estate professional you can trust, they might be able to answer your questions and help you on your way.