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I've been in Real Estate since 1983. I have been through 3, 4, 5 recessions and have survived them all. The depression of 2009 is probably the worst of them all. There is a very real reduction of home values and many have been caught off guard.
Many
are struggling to make their monthly mortgage payments, or it has
become a major concern. Up till now, if we got behind on our mortgage
(or are struggling to make the payment) we had no alternative but to go
into more dept, by charging our credit cards, or contacting our bank and begging for more money, or a break. The result, foreclosures are way up, as are all credit defaults.
So what can we do? What IF I could show you a way to reduce your monthly mortgage payment and reduce the mortgage balance at the same time, would that be of interest to you?? This process would also work on investment property creating lower mortgage payments, increasing cash flow and a lower mortgage balance!!!! (More equity)
Leverage is a fantastic thing. Up till now, the banks have had all the leverage and we the mortgagee have had zero. We have no control and have only one choice, pay up or go bankrupt and/or lose our home. Remember, “The Golden Rule”, he with the gold makes the rules.
Even if you’re still able to pay your mortgage, you may have great concerns, or your payment has increased, or will be increasing soon.
What I have discovered, can fix all of that and you don't need to be behind in payments. Also, your credit, job history, or income ratios don't matter.
All you need is the desire to reduce your monthly mortgage payment and reduce your mortgage balance at the same time.
Some people have had the value of their homes go down so much, that they owe more than the home is worth. I have a relative in Florida who purchased his home a few years ago for $246,000. The banks were handing out 100% mortgages, so he got one. A stated income loan with an interest rate of 8% and a multiple payment option. (He could pay interest only if he chooses)
Well flash forward, it’s now summer 2009 and the value of his home is $160,000. His mortgage balance is $240,000. He now owes $80,000 to the bank, more than the house is worth. What are his choices??? Doesn't it stand to reason, that if somebody is so upside down, that no bank will help him??? If he walks away from his home, it will be foreclosed (destroying his credit) and somebody (not him) can then purchase the home out of foreclosure for $160,000 or less. But he can't!! Does that seem fair???
He can't even buy down; in other words, buy another home in the same area at today’s prices. No bank will give him a loan, because he's so negative in his currant residence.
This scenario is playing out all over the country. Please understand, my relative has a great job and has cash. He is not behind on his mortgage has pretty good credit and pays his bills.
Now there is a government program to assist. He first has to have a “personal hardship”; he doesn't qualify, because his mortgage problem doesn't count. If he qualified, he would be put through the governments plan and all his finances would be researched by the government (kind of like an IRS audit) to see "if" he "could" qualify. If he qualified, there are presently very few banks that even accept this plan, so it’s very likely he wouldn’t be accepted anyway. I know someone presently going through this laborious process (with attorney fees) and it's been 6 months. (No answer yet, but we are keeping our fingers crossed)
Now if he was lucky enough to be accepted, what would the bank do? Well, the bank can (at their sole discretion) reduce his interest rate to as low as 2%. That would help, however the bank would then add the lost income to the end of the loan. Hence extend the loan (mortgage) several years to make up the difference in income to the bank. The monthly payment would be reduced, but there would be no reduction in the balance. So, he would still owe 240,000 on a home that is worth only $160,000.
And you wonder why after all that 80% of the assisted borrowers still walk away from their homes.
I have a better idea!!
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