Big jump in foreclosure counseling
Real estate brief
By Inman News, Friday, November 14, 2008.A report from the U.S. Department of Housing and Urban Development found a 55 percent increase in the number of families receiving foreclosure prevention counseling between 2006 and 2007, with growth expected to be much higher in 2008.
HUD's report, "The State of the Housing Counseling Industry," revealed that of the approximately 136,000 families that completed this counseling during 2007, 45 percent were able to remain in their homes while 14 percent ultimately lost their home through foreclosure. Outcomes for the remaining 41 percent of clients are not known.
The report also finds that in the years leading up to the current crisis, more than 55 percent of low-income families seeking to buy their first home did not seek out pre-purchase counseling. This lack of counseling likely left them unprepared to make one of the biggest financial commitments of their lives and may have contributed to some of today's high rates of default and foreclosure.
Compared to the U.S. population as a whole, counseling clients are substantially more likely to be minority, the report found. Of the 1.7 million individuals that received counseling services from a HUD-approved agency in 2007, 54 percent were white, 36 percent were African-American and approximately 20 percent were Hispanic. Most clients that received counseling from a HUD-approved agency are very low- or low-income.
A breakdown of the services clients received in 2007 revealed 308,389 sought pre-purchase counseling; 264,989 sought help to resolve or prevent mortgage delinquency; 202,795 clients received mortgage refinance and reverse mortgage counseling; 380,006 persons received rental counseling; and 48,593 clients sought counseling on shelter or other homeless assistance programs
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Submitted by Paul Stout on November 14, 2008 - 7:03am.
Paul K. Stout, Realtor
As a representative of Titanium Solutions, we council home owners who are in a pre-foreclosurer situation. We represent the home owner's mortgage company. Many of our assignments come with Loan Modifications. However, in all cases the home owner is encourgaged to contact their mortgage company. We help them make that contact. This service helps people. In many cases, we are the first person they have told their story to, and to do that,is a relief, and gives them hope. Saddly, we do not help everyone. Some home owners are not responsible in how they spent their money. When this happens, where negative cash flows occur, the outcome is their relocation by way of a short sale.
Submitted by Anne Hensel on November 17, 2008 - 4:58am.
When you are faced with a short sale or pre foreclosure situation, it is important that you get all the information you can, as soon as possible. Unfortunately property owners are totally overwhelmed, frustrated, discouraged and helpless when it comes to a short sale/ foreclosure. They just fell like sticking their head in the sand. I can understand all this, but ignoring the problems thinking it might get better, waiting, all this does not help. Counseling will help, it will give the seller/ owner a clear idea of what they are dealing with.
Someone once said “we only fear what we do not know” that is very true in a short sale situation. A lot of the home owners / sellers that I deal with are paralyzed, and again no action is the worst thing you can do.
I think counseling is a great idea, it might show you options you did not know existed, and it gives you and understanding of your situation and that is so important for your state of mind. Once you have gone to counseling you will feel like someone took the weight off your shoulders and you can think straight again.
“45 percent were able to remain in their homes” that number speaks for itself.
Anne Hensel
Broker, ABR, E-PRO, C-CREC, ASR, AHS, TRC, RECS
South Beaches Real Estate Professionals
727 409 8706 www.Southbeaches.info