Posted on February 05, 2013 in Foreclosure

Now that mortgages rates have lowered, people are looking to refinance their homes in order to keep them. To be eligible for refinancing a mortgage, applicants must have good credit ratings and a steady income source. This presents a problem for older people who could really benefit from easier mortgage payments.

The AARP has released many figures that document the financial state of those considering retirement. More than 1.5 million individuals over the age of 50 have lost their homes since 2007. More than 3.5 million are currently at risk of foreclosure. More than 16% of homes owned by the baby boomers are underwater or lack the equity to refinance leading to foreclosures for those who are on a fixed budget.

It is also compounded by the fact that more people are still paying their mortgages after they have retired. “More older Americans are carrying mortgage debt than in the past, and the amount of that debt is also increasing…leading to their worsening situation,” said AARP vice president for policy Debra Whitman. “It's one thing if your housing value goes down in your 50s. It's another thing if you're 75. For some people, it's not like you can go back to work.”

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 Posted on January 17, 2013 in Foreclosure

Many news reports from the last few months have talked about the “fiscal cliff” and how badly consumers and businesses would be affected by increased taxes. At the last moment, Washington came to an agreement about how the tax breaks would be handled, if that meant modifying them, extending them or letting them expire at the end of 2012. One tax measure included the decision was the Mortgage Forgiveness Debt Relief act of 2007.

This act benefits people who are planning to unload their houses and who have underwater mortgages. A short sale allows the principal to be reduced by a mortgage lender and helps avoid foreclosures. But, without the extension of this tax break, people who complete short sales could be responsible for punitive taxes on the forgiven amount.

The good news for those looking to short sell their homes is that the Mortgage Forgiveness Debt Relief act was extended to the end of 2013. The tax benefit also helps people who have experienced a reduction of principal, foreclosure, or deed in lieu of foreclosure, though it helps short sales the most.

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 Posted on December 24, 2012 in Foreclosure

In Illinois, 13,520 properties received foreclosure letters last month—equating to roughly one out of every 392 houses in the state. This figure is up 9 percent from November 2011, and puts Illinois only behind Florida and Nevada in terms of foreclosure rates.

Illinois' Cook County had the highest figures in the state: 2,299 homes received initial notices of default, 2,651 homes were scheduled for court-ordered sales, and 2,086 homes were repossessed by lenders. The cities of Rockford and Chicago ranked 11^th and 13^th in foreclosure rates.

Nationally, more than 59,000 homes were repossessed, a 5 percent rise from last November. In addition, the number of homes that became bank-owned rose on a year-over-year basis for the first time since October 2010.

However, according to an article from the Chicago Tribune, foreclosure trends are heading in the right direction. Although Illinois' foreclosure rates have increased from a year ago, the numbers have dropped 9 percent from October 2012. In Cook, DuPage, Kendall, Will, Kane, and Lake Counties, the figure has dropped 10.5 percent from October. Experts are viewing this as a positive sign, saying that we are past the worst of the housing problems.

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 Posted on December 15, 2012 in Foreclosure

Illinois is one of several states in the US that is still experiencing a large amount of foreclosures. The results from October of this year have the foreclosure rate increasing by 6% over September. Compared to October of last year, that rate has increased by 19%.

The good news is that state and federal governments have noticed these trends and have stepped in to help. Take the federal program Hardest Hit as an example. This program was created in 2011 to offer relief to the unemployed and underemployed homeowners. They have dispersed over $57 million to residents of Illinois up to $25,000 per resident.

Since Illinois ranks third in the nation in past due home loans, there are other steps that the state is doing to help Illinois residents. There has been a push recently to fund more counseling programs for distressed home owners. This counseling has proved very beneficial according to Illinois Housing Development Authority. The executive director of IHDA Mary Kenney said that defaulting homeowners who receive counseling have a 50 percent better chance to receive a loan modification. They are also 67 percent less likely to fall into default again.

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 Posted on October 22, 2012 in Foreclosure

In last August, the foreclosure rate of Illinois was the highest in the nation. However, it has decreased gradually in September and October, although the rate still remains relatively high, according to the Chicago Tribune.

In September, over 14,000 homes in Illinois were the subject of a foreclosure filing. The filings included initial notices of default, notices that a court-ordered sale of the property had been scheduled, and homes repossessed by the lender. In Cook County, which has the highest population of any county in the state, the foreclosure rate decreased from August of this year, but is 18 percent higher than a year ago in September. Foreclosure matters should be handled with the assistance of highly qualified attorneys.

Foreclosure rates have declined on a national level and have been lowest this year since July of 2007. The national decline is driven by improvement in large states which do not rely on the courts to process actions. For example, in California, Texas, Arizona and Michigan the situation has improved during the year, according to Realty Trac, which collects foreclosure data from all over the country. In states such as Illinois and Florida, where the foreclosure process is handled by local court systems, the average time to foreclosure is still high. On average, it takes almost 700 days to complete a foreclosure action in Illinois.

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 Posted on September 28, 2012 in Foreclosure

Today we will further elaborate on short sales, a viable alternative to foreclosure that many people choose. Simply put, a short sale is selling your house “short” of what you owe the bank. First, you must list the property for sale with a realtor or by independently finding a buyer. Generally one will notify the bank in order to receive a reasonable amount of time to find a buyer and receive an offer. After receiving an offer, this is then submitted to the bank who will decide to accept or reject the offer. If the bank accepts, they can choose to either write the difference off or pursue the difference owed from the property owner. Short sales are typically an attractive option for banks and there are a variety of ways to help put you in the best position possible for a short sale. The attorneys at Newland & Newland can help you assess if a short sale is a good option for your situation and to help you through the process.

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 Posted on September 14, 2012 in Loan Modification

Finding yourself in hot water with your mortgage and trying to stay out of foreclosure? There may be a solution.

Whether it's called a loan modification, mortgage modification, restructuring, or workout plan, it's when a borrower who is facing great financial hardship, having difficulty making their mortgage payments and is facing foreclosure, works with their lender to change the terms of their mortgage loan to make it affordable. The workout plan varies by lender, but changes could include temporary or permanent changes to the mortgage rate, term and monthly payment of the loan, the past due amount could be rolled into the loan, and the new balance re-amortized.

In February 2009, the government unveiled the Making Home Affordable Program, which is made up of two main programs: one for loan modifications and one for refinance loans. The loan modification portion is called the Home Affordable Modification Program (HAMP). It is designed to reduce mortgage payments struggling homeowners pay per month to sustainable levels.

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 Posted on September 10, 2012 in Foreclosure

Today, we will discuss an alternative to foreclosure that may not be available to everyone, but is nonetheless an excellent option if you qualify for it. Refinancing your home requires good credit to qualify and your lender will also consider aspects such as income, assets, debts, and current value of the property. Refinancing can be considered for a number of reasons. These include lowering your interest rate, adjusting the length of your mortgage, changing from an adjustable rate mortgage to a fixed rate mortgage or to get an adjustable rate mortgage with better terms. Refinancing fees can greatly vary by lender, but they can amount to 2% to 6% of your outstanding principal.

If you think refinancing is an option for your property, please talk to one of our many qualified attorneys that can help walk you through the process.

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 Posted on July 04, 2012 in Loan Modification

If you're a typical homeowner, you probably feel like David facing up at Goliath when you speak with your lender about modification of your home mortgage. Despite efforts to put the odds more in the consumer's favor, most aspects of modification are in the bank's hands. But there are some ways to make easier.

Hire an experienced attorney. The bank has plenty of legal advice and firepower on their side. Plus, they're the ones who make the contracts you sign. So they're at a distinct advantage when negotiating anything with you. In order to even things up, secure an attorney who is knowledgeable and experienced with loan modification.

Write our a concise hardship letter. Explain why your circumstances have changed to the point that you can no longer afford your payments. Were your hours cut back at work? Do you have unexpected medical bills?

Be honest about your financial situation. You'll have to compile a lot of paperwork about your current financial situation. Don't lie about your current assets, or try to make things sound worse than they actually are.

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 Posted on June 18, 2012 in Foreclosure

For some homeowners, especially those who are significantly underwater, walking away from the property is the desired outcome. They ask themselves “Why should I payoff or modify a loan for $200,000 for a property that is only worth $100,000?” This is a very good question, and an important one to ask. The problem in this situation, however, is a personal deficiency judgment. This is when the bank can take a judgment against the borrower personally to satisfy the outstanding amount of the debt that remains after the property is sold.

For some homeowners, sentimentality is the answer. The property is very important to them as it is the only home they have ever owner or it is where they raised their children. If this is the case, then a modification is an excellent option, if possible.

If, however, the sentimental value associated with the property does not rise to the level of wanting to payoff or modify an underwater property. For those homeowners, the a big concern is a personal deficiency judgment against their personal property or assets.

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