More hope for home owners OR Christopher Dodd can’t add

You may have been too busy watching American Idol (I understand!) but there was some new news in the mortgage world today.

Six of the big, big, BIG boys in the mortgage business have decided to give homeowners, who are extremely late on their mortgages, a 30-day reprieve to try and work out a solution.

It’s called “Project Lifeline” and is for borrowers who are 90+ days late on their mortgage.

Of course we’ve already started to hear complaints from politicos who think this isn’t enough and that the banks (and/or taxpayers) should just buy these folks’ homes and let them live there free of charge. (Okay, so maybe I exaggerate here.)

US Senator Christopher Dodd said there will be “millionS” of foreclosures “in the coming months”.

Ummmmm what????

Millions?

It’s bad enough that he wants responsible folks, who are paying their mortgages, to foot the bill for those who default, but now he’s just saying silly and ridiculous things and pandering to the voters. (Talk about irresponsible.)

ALL borrowers will be sent letters explaining the 30-day reprieve and will urge them to contact their lender to try and work something out.

I think what would be really interesting to know is how many borrowers actually make the EFFORT to contact their lender to see what can be done.

Let’s face it, most of these near-foreclosure borrowers didn’t get there by accident, but are they purposely willing to make an effort to get out of the jam?

As for “millions” of foreclosures let’s look at the FACTS shall we? (I know, why would we do that???)

According to Hope Now, an organization that is working to help distressed home buyers, in the last half of 2007:

283,000 homes went all the way to a foreclosure sale.

283,000.

Not millions.

Not one million.

Barely above a half million as a matter of fact.

Nearly 1.5 million borrowers faced difficulties paying their mortgages in that same time period and more than 45% of them (45%!!!!) were helped out with formal, new repayment plans, and nearly 15% had their loans modified.

The study goes on to point out that only 1/3 of delinquent borrowers ended up going all the way to a foreclosure sale.

ALSO, and this is a direct quote from the study:

Frequently, borrowers do not respond to their servicer’s attempts to contact them until they receive their first legal action notice.

If you or someone you know is having trouble with their mortgage CONTACT THE LENDER. Sure it’s tough, but not as tough as losing your home, right? Suck it up and call your lender to see if there is anything they can do for you.

If you’re currently paying your mortgage, or thinking about buying a home, but are afraid that the housing market is collapsing don’t be. It’s not and it won’t. Mark my words.

Beth Skinner is a real estate professional who actually returns phone calls and emails! Click here to search the MLS for your dream home.

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