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Homeowner Relief from COVID-19

Homeowner Relief from COVID-19

Homeowner Relief from COVID-19

While some of us still might be getting a paycheck others of us may not and with your mortgage payment looming that can be extremely stressful. With the outbreak of coronavirus, homeowners may find themselves in challenging situations unable to make their mortgage payments. 7 out of 10 Americans live paycheck to paycheck and have less than $1000 in the bank. This can bring on stressful times for those of us that still need to make our mortgage payment. So what kind of homeowner relief from COVID-19 is available?

According to Fannie Mae, if Fannie Mae owns your loan, their Disaster Response Network can help navigate the mortgage relief process and offer other solutions to financial challenges. If you need mortgage help, Fannie Mae is available.

If the coronavirus has caused you to lose your job or income there are options. Homeowners may be eligible for forbearance plans to reduce or suspend their mortgage payments for up to 12 months.

Homeowners will not incur late fees during this time.

The credit bureau reporting of past-due payments of borrowers that are currently in a forbearance plan is suspended as well.

After the forbearance, a servicer must work with the borrower/homeowner on a permanent workout option to help maintain or reduce monthly payment amounts as necessary. This might include a loan modification.

Foreclosure sales and evictions of borrowers are suspended for 60 days.

While we don’t think that this outbreak and quarantine will last for 12 months, it is important to act quickly. If you have a Fannie Mae loan and are unable to make your mortgage payments, you can contact their Disaster Response Network for assistance. Their HUD-approved housing counselor can assist you in your needs and come up with a personalized action plan.

If your mortgages to Freddie Mac, similar forbearance assistance may also be available.

CONTACT US TODAY

Because new mortgage rules with the coronavirus can change daily, it’s crucial that homeowners communicate with their lender about the latest options available to them. What might not have been available last week could be available today. The important thing is to keep you in your home, prevent or avoid foreclosure, and develop a plan for the next year ahead.

For more information on loan modification, questions on bankruptcy, and mortgage mediation, contact our office at any time.

Fear losing your home? Foreclosure looming?

Fear losing your home? Foreclosure looming?

You held out for this long but your lender has finally sent you the” letter.”  However, the letter talks about consumer debt counseling and mediation.  This is part of the Washington Foreclosure fairness act.  Lenders must inform you of your rights before a Foreclosure can be processed.  Bankruptcy is a valuable option to consider.  Understanding and knowing your options will help you to come out ahead.

Bankruptcies are on the decline?  You might think so as the economy recovers but bankruptcies are actually on the rise in many areas.  If you have recently been sent a letter from your bank or lending institution, it is time to contact an Attorney or consumer debt counselor that is recognized by the court system.

Whether you have been laid off, had medical issues with bills piling up, or just got in over your head with consumer debt, you are not alone.  Now you are afraid you are going to lose your home.  There are ways to help save your home.  Check out the New Washington program to help people just like you.  It is called the Washington foreclosure fairness act.  This act helps homeowners just like you to help are you negotiate with your lender.  It requires a wonder to notify you of the process before the foreclosure process starts.  The process includes consumer debt counseling and mediation with the lender.  You will need to have an Attorney or a debt counselor on your side to go into the mediation process.  Advantage legal group out of Bellevue can help you find your best option, walk you through the process, and hold your hand through the process.

It will become much clearer through the Washington foreclosure fairness act and with the aid of an attorney to be knowledgeable about your rights and responsibilities, and how to save your home.  First being in the mediation process actually stops the foreclosure.

Advantage Legal Group offers free seminars in Seattle and around the Puget Sound area.  These free seminars cover many options for distressed homeowners.  Knowing what options are available to you and what makes sense for your family will give you the confidence to go through the foreclosure process, mortgage mediation process, or short sales process.  These are only a few of the strategies that the seminar covers.  Understanding your financial situation and the types of strategies that are out there for you will help you to figure out your defense.  Is mortgage modification the option for you?  What is your best option, deed in lieu of foreclosure, mortgage modification, short sales, mortgage mediation, and what will your Foreclosure defense strategy be.

If after the seminar, you need more information Jonathan Smith a Seattle Bankruptcy  Attorney will schedule a free consultation with you to go over even more specific situations.

Additional Financial Resources:

 

Preventing Bankruptcies

Preventing Bankruptcies

We are in some unusual and unprecedented times right now but that doesn’t’ mean you can’t prepare and still have some time to plan.

People use the phrase “Practice good money management.”  However, what does this really mean?  Terms like impulse spending, realistic budgeting, and no high-risk investment are not part of the “good practice.”  Understanding what is good money management practices can help you in preventing bankruptcies.  Bankruptcy might be your only option but there are ways to prevent it.

How do you avoid impulse spending? 

  • Impulse spending is spending money on anything that is not a NEED.  Steps you can take to avoid impulse spending:
  • Cut up credit cards so you cannot use your credit.
  • Take your credit cards out of your wallet so you have time to think about a purchase you are going to make.
  • Ask yourself do I need this item or just want it.
  • Can I get this item somewhere else for less money?  Is an item available on Craigslist, E-bay, or a thrift store?
  • Discipline yourself to use credit only when you know you have money in the bank to pay off the total at the end of the month.
  • Tear up credit card offers.
  • Tear up credit card checks that your credit company sends in the mail.
  • If you have to use credit cards and you are not in a position to pay the total off at the end of the month pay more than the minimums.  If you can pay more than you put on the card that month.
    • Say you have$ 5000 in debt on a credit card and you bought $500 in stuff this month.  Pay $500 plus more when the bill comes.  This way you didn’t add anything to the card and if you did pay more then you are on your way to reducing the outstanding debt on the card.

What is Realistic Budgeting?

  • Write down what you pay each month for bills:  House payments, electricity, garbage, water, natural gas, home insurance, life insurance, medical insurance, car payment, cable, phone, internet, and whatever else is a reoccurring monthly expense.
    • Some expenses are every other month like garbage and natural gas.  Set aside an amount so that the total bill can be paid when it is due.  (If your natural gas bill is around 200 every other month set aside 100 on the month it is not due that will be used in the next month)
  • Budget for food, entertainment, gas, and misc. expenses
    • Know what your average spending is for food, entertainment, gas, and misc expenses.
    • Create a set amount (budget) for each category and stick to it.
      • This might take some collecting of receipts or writing down each purchase.
      • Some people have taken out money from their paycheck, put it in an envelope, and that is the money for food for the month.
      • Whatever will work for you, to stick to a set amount, and do it!

What are high- risk investments and how can I avoid them?     

  • Don’t incur debt with others who have questionable financial habits.
    • If they walk out on a debt your credit rating will be effected
    • Co-signing on loan is a high-risk investment – it might be helping a family or friend out but if anything happens to them, you are left holding the loan!
    • Interest-only loan payments are high-risk investments.  If you can only afford to make an interest-only home payment, then the house is out of your price range.

You may be looking at how to get out of debt and bankruptcy seems like the only way just remember these ideas so you will not have to file for bankruptcy again.  Contact advantagelegalgroup.com for more help.

Schedule a Consultation

 

Additional Financial Resources:

 

What Happens if the Bank Forecloses on My Short Sale?

What Happens if the Bank Forecloses on My Short Sale?

It happens quite often…more than you realize…that a home in process of a short sale is foreclosed on. It is a common misconception that the lender won’t file a foreclosure lawsuit against you if you are currently in the process of negotiating a short sale or loan modification.

Example:

Debbie lists her home for a short sale in November and receives a contract from a buyer. While waiting for the bank’s approval, at the end of April gets served with foreclosure papers. How can this be if she has a contract on the property?

It can be. And again, it is quite common. You should expect to get served with a foreclosure lawsuit four months or so after you stop making mortgage payments. When you try to complete a short sale, it more often than not takes a month or two to get it under contract and 45 to 90 days to get approval from the lender. If you fail to respond to the foreclosure within 20 days, you will be in default and will have waived valuable rights in defending the lawsuit in case the short sale falls through. It is recommended that you see an attorney about responding to the lawsuit.

With the right and proper sequence of actions, it is possible to get foreclosure postponed so that you can successfully short sale your home. It takes knowing when and how to be proactive.  Advantage Legal Group can help you determine the best course of action for your foreclosure situation.

For more information on mortgage mediation, foreclosure, short sales, bankruptcy and all things related to personal finance, check out Bellevue Bankruptcy Blog. These topics and issues can be confusing and stressful, but help is available! Contact us today!

More tips on Short Sales:

 

Defined Contribution Plans Offer Employees Great Retirement Potential

As a business owner, if you work with federal contracts, you already know that the landscape is riddled with potential compliance landmines. The government is very focused on compliance with all of the provisions of the Davis-Bacon Act. One area that companies often find troublesome relates to Defined Contribution Plans.

According to the United States Department of Labor, the Employee Retirement Income Security Act (ERISA) covers two types of pension plans: defined benefit plans and defined contribution plans. A defined benefit plan promises a specified monthly benefit at retirement while a defined contribution plan, does not promise a specific amount of benefits at retirement.

For you the business owner, that is an important distinction.  Often, contract employees might not understand that while the amount of money contributed by the employer, the employee or both is set as a percentage of total earnings, the fund is an investment and returns are subject to market related gains or losses.

What are Defined Contribution Plans? Well, two commonly known plans are 401(k) and 403(b) plans. Profit-sharing plans and employee stock ownership plans are also listed in this category.

In essence, individual accounts are set up for participants. The amount of benefit is determined by salary percentages and may come from contributions made by the employee or the employer. The yield of this kind of program is determined by the success of the investment earnings and is not guaranteed to grow. In fact, the principle values may actually be lessened if market trends are poor.

There are tremendous benefits for companies that use contracted labor, but compliance with the Davis-Bacon Act is essential for attaining and maintaining government contracts. Defined Contribution Plans are a great way of offering employees the potential for growth in their retirement accounts.

 

Should I Hire a Lawyer for a Mortgage Mediation or Foreclosure?

Should I Hire a Lawyer for a Mortgage Mediation or Foreclosure?

Should I Hire a Lawyer for a Mortgage Mediation or Foreclosure? – If your lender has failed to approve previous effort to modify your loan, often mediation is the best way to go. What is mediation? Foreclosure mediation is a meeting where a homeowner and mortgage lender negotiate potential modifications or other alternatives before an impartial Judge in an attempt to reach an agreement. And this kind of mediation requires the expertise of a lawyer.

Related: What to Expect in a Bank-Owned Home

Why hire a lawyer? The most common question asked when someone is facing foreclosure is, “What will give me the best chance to avoid this?” Although circumstances involved always vary greatly, the answer ALWAYS remains the same. And that answer is this, ” to fully and most completely use all your rights and remedies including foreclosure defense, loan modification, mortgage mediation, and bankruptcy, you MUST be represented by a foreclosure lawyer…an EXPERT foreclosure lawyer.”

Schedule a Consultation

You need a lawyer with TONS of experience and you need one NOW.  So, be sure to ask your potential representation how long they’ve been representing clients like you, how long their practice has been devoted to foreclosure prevention and then review evaluations of recent clients.  Remember, get to work on this immediately as delay, indecision and denial are the enemies of foreclosure prevention.

Beware of scams and make sure your lawyer is an expert. Anyone who generally guarantees they’ll save your home is either a scam artist or ignorant or both. Additionally, the person at the bank may be a brand new hire who knows nothing or someone who actually knows what they’re talking about. Either way, the next time you call, you may get the new hire. You want an expert, the same expert, and throughout the whole process.

An expert can help you understand the debt and tax consequences of a short sale, protect you from pitfalls and scams, assure you that, should foreclosure happen, you have the right to stay in your home for as long as your rights and remedies allow and enable you to plan where you’ll live next without fear of the sheriff showing up and ordering you to leave. An expert lawyer can also, in most cases, help you to be debt-free when you leave should foreclosure be inevitable in your case. And of course, an expert lawyer can help you come to an agreement with your lender that avoids foreclosure altogether.

Yes, these kinds of lawyers can be expensive but hiring an expert almost always benefits you not only financially but emotionally. The benefit of avoiding the loss of your home is obvious. But should you lose your home, remember, as mentioned before, there are pitfalls and scams to avoid and knowledge to be learned about debt and taxes that come with certain mediation agreements.

To contact an expert representative today, visit Advantage Legal Group.

Schedule a Consultation

The Foreclosure Fairness Act

The Foreclosure Fairness Act

The Foreclosure Fairness Act

A little known law helps protect homeowners from foreclosure even when their situation may seem dire. The Department of Commerce is trying to spread the word about this law and Advantage Legal is here to help.

The Washington State Department of Commerce put out a press release to let people know about this Act that helps primary residential owners go into mediation with banks via a counselor or lawyer and look at alternatives to foreclosure. It’s a great way for homeowners to get help without the frustration of getting lost in the paperwork.

What is the Foreclosure Fairness Act?

“The Foreclosure Fairness Program provides homeowner foreclosure assistance by offering free housing counseling, civil legal aid, and foreclosure mediation. The program, created by the 2011 Foreclosure Fairness Act, helps homeowners and lenders explore possible alternatives to foreclosure and reach a resolution whenever possible. The Act requires lenders to notify homeowners, prior to initiating foreclosure, of the availability of foreclosure counseling and the potential for mediation, and to participate in mediation with homeowners who have been referred to the Mediation Program. The program is funded through fees paid by financial institutions recording notices of trustee sale on owner-occupied residential real property in Washington state (some financial institutions are exempt from this fee).” [Source]

 

This Act is huge for homeowners who are scared of losing their home or frustrated with the process of trying to save it. This Act along with experts like those at Advantage Legal Group brings happiness and relief to many Washington families.

Each individual case is different but the Foreclosure Fairness Act and Advantage Legal were able to help one particular family who hasn’t paid their mortgage since March of 2015 and their unpaid amount plus their principal balance totaled approximately $511,488, with the help of the Act and Advantage Legal they were forgiven the amount of $256,488. WOW! That’s forgiveness of almost half of what they owed. They were also able to get their monthly payment cut almost in half and their interest rate went from 8% down to 5%.

These kinds of results are almost impossible to get on your own without the help of experts like Advantage Legal.  If you’re not sure if you qualify under this law,  you can go to advantagelegal.com or call their office at 1-877-mediation to get a free consultation to discuss your situation.

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For more information on related topics check out:

Should I File Bankruptcy?

What If I’m a Year Behind in My Mortgage Payments?

 

What If I’m a Year Behind in My Mortgage Payments?

What If I'm a Year Behind in My Mortgage Payments?

What If I’m a Year Behind in My Mortgage Payments?

You may be behind only two months in your mortgage payments or up to two years behind! Wherever you may find yourself on that scale, the question is, what do you do and what’s going to happen? First and foremost, let’s be clear that it is vitally important that you keep in good communication from the get-go or as soon as possible. The longer you avoid notices due to embarrassment or denial, the worse things can get.

Lenders are usually very willing to work with you UNTIL a Notice of Default is filed. Once one of these is filed, it is very hard to work with your lender as they are looking out to protect their interest. So, be sure to communicate early and often. Also, keep a clear record of every time you communicate with your lender: the day you called, the name of the person you talked to and what you talked about. This can only help you later down the road. Remember, lenders do not want to foreclose, so if you’re unable to fulfill your mortgage obligation, contact your lender immediately so they can give you options to help you.

Options may include:

  • time to make up your payments. You may be granted something called forbearance, an agreement from the lenders to not take action against you while you work out a repayment plan that is affordable for you.
  • -forgiving a payment. The lender may grant you debt forgiveness, which means they may let you skip a payment or two if you can prove that you will be able to pay thereafter. However, this rarely happens.
  • repayment plan. Sometimes you can spread the missed payments out over a longer-term. For example, if your mortgage is $900, you may pay $200 more a month until you’re caught up, temporarily making your payments $1100.
  • -change the terms of your loan. Maybe your interest rate can be adjusted or maybe your amortization period can be extended.
  • refinance. You may be able to add the back payments to the balance of your loan if you have sufficient equity.
  • -partial claim. Some government loans have provisions that allow the borrower to apply for another loan to pay back the missed payments if they meet certain criteria.

The above are routes of action if a Notice of Default has not yet been filed. if one has been filed, your remaining options are to reinstate your loan, sell your home, consider a short sale or sign a deed in lieu of foreclosure.

To learn more, contact Advantage Legal Group.

Ready to schedule a consultation?  425-452-9797
Or Contact Us Here

Additional Resources:

 

 

Can I Refinance After a Mortgage Modification?

Advantage Legal Group is in the business of helping people that are in financial distress either modify their existing mortgage, refinance or find a way to mediate between the lender and the homeowner. We get asked quite often if homeowners can refinance after a mortgage modification.

Can I Refinance After a Mortgage Modification?
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A mortgage modification is typically handled between a housing counselor or a qualified attorney and the homeowner and lender. The homeowner cannot go to the lender directly and ask for this mediation but must do so with a housing counselor or lawyer. This is where Advantage Legal Group comes into play. We talk to the lenders for you and make them come to the table to discuss options to either lower your mortgage payment permanently or for a short amount of time. We can modify your existing term, save you thousands and get you caught up on any past mortgage payments.

Often times we get asked if people can refinance after they’ve already had a mortgage modification. Refinancing may not have been an option initially but now that they have dealt with the modification for several months they may want to refinance. Some homeowners that have gone through the Home Affordable Modification Program may now want to refinance to a permanent lower rates. With rates continuing to creep up this is not a bad idea.

In order to qualify for refinance after modification you must have made at least 24 monthly mortgage payments consistently since the modification was completed, not since you’ve applied. If there was an additional second mortgage in place that waiting time qualifies. If you’re purchasing or refinancing at different property that did not undergo the modification you only need to wait one year.

Related: What if you have to sell fast and move quickly?

All of these qualifications still apply whether you’re refinancing or buying a new home. You can’t modify a mortgage and then sell that home in the next two months. You must make consistent payments for at least 12 or 24 months depending on your situation before your allowed to refinance or apply for a new loan. Of course you can sell the property but you cannot apply for a new loan after that particular waiting period.

Feel free to view our video below on mortgage mediation and how Advantage Legal Group has helped hundreds of Seattle area residents keep their homes and lower their mortgage payments by refinancing or mortgage mediation.

Refinancing, buying a new home or mortgage modification definitely is something to be discussed with a lender or qualified housing counselor or attorney. For more information contact Advantage Legal Group and thank you to our guests blogger this month Tina Droessler. Tina is an expert real estate professional in Palm Desert and helps dozens of homebuyers and homeowners each year find or keep the home of their dreams.

Will a Mortgage Modification Work for Me?

Will a Mortgage Modification Work for Me?

To hear the term, “mortgage modification” incites both hope and fear. Why because it is a way to save your home, but very few achieve it. Even housing counselors admit that there’s seemingly something mysterious that dictates who actually qualify for a mortgage modification but there ARE ways homeowners can better their chances.

Will a Mortgage Modification Work for Me?

Tips for getting a mortgage loan modification:

1) First, homeowners need to gather together and submit paycheck stubs, a hardship letter, a budget and any other documents that the loan servicer is going to want. You don’t want to miss ANYTHING because if you do, your loan file gets tossed aside to deal with a package that IS complete.

2) Next, you want to ask questions. Be certain you know exactly what to provide to servicers. Servicers often ask for two paycheck stubs assuming that two paychecks represent one month’s income. But a homeowner who is paid weekly, bimonthly or monthly may have to submit more or fewer paycheck documents. See the misunderstanding here? Similar misunderstandings on other documents can cause big problems.

3) Additionally, you should keep contact/communication current. Homeowners should call the servicer at least weekly to check on their request. Ask if your package is complete and review the documents. Explain any and all special or changed circumstances. Counselors do help but lenders also want to hear from the homeowner often.

4) Lastly, be persistent. Of course, you’ll feel frustrated and annoyed when asked to resubmit documents. However, if you simply realize you’re at their beck and call and hang in there, you just may be rewarded in the end!

Some more tips:

Through all the above tips, remember to be FLEXIBLE…loan modifications come in many varieties. Consider taking what you can get.

Also, release your tax return. Homeowners are required to not only submit income documents but also sign IRS Form 4506-T, which allows the servicer to access the homeowner’s federal tax returns. People often don’t succeed because their unable to provide good proof of income.

Contact Advantage Legal Group to get started on mortgage modification in Seattle.

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