MIAMI, FL - If you haven't already, federal housing officials think it is a good time to dig out your mortgage documents and give them a good once-over. In fact, they recommend borrowers hoof them down to a counseling agency to make sure there are no ugly surprises later this year, namely, a jump in monthly loan payments.
Another effort to keep borrowers from losing their homes to foreclosure was launched Wednesday by the Department of Housing and Urban Development. Called ''Keep Your Home, Know Your Loan,'' the campaign includes public service announcements and print materials that will be distributed in six major metropolitan areas where home foreclosures rates are soaring, including Chicago, Los Angeles, Detroit, New York, Phoenix, and, naturally, Miami.
''This is an opportunity for us to reach out to people who may not be in foreclosure yet, but could be facing one this year, due to a rate change, the economic downturn, job loss or having their hours cut,'' said Armando Fana, director of HUD's field office in South Florida.
In 2009, a weakening economy and job losses are likely to push more homes and condos into the foreclosure whirlpool that has claimed 143,000 properties in Miami-Dade and Broward counties over the last two years, according to statistics from RealtyTrac.
While the bulk of resets for problem-plagued subprime mortgages in South Florida peaked last month, there are plenty more time bombs to come. And though the interest rates to which adjustable-rate loans of all sorts are pegged, even small rises in monthly payments could be a strain on hard-up borrowers.
Fana encouraged borrowers who fear, though are not yet sure, they may face problems down the road to take preemptive action. Many lenders can work out temporary solutions to tide them over until their financial situation improves.
For those whose loans are resetting, housing counselors said lenders are doing a better job of responding and restructuring mortgages in sustainable ways. ''Lenders were taking forever. They're overwhelmed just like we are, but now they are working a lot faster,'' said Jackie Duran, who directs foreclosure prevention efforts for Miami-based Neighborhood Housing Services. ''Turnaround is two to three months now versus five or six months before.''
Fana and Duran agreed that borrowers who need their loan modified may find it's easier with professional guidance, since the process can be flummoxing and require budgeting and a lot of paperwork. As part of its campaign, HUD has also launched a new hot line, 877-HUD-1515, where homeowners can get information about HUD-approved counseling agencies in their area. Fee-based, for-profit loan modification specialists are cropping up all over the place, too, and offer another option, though Fana said homeowners low on cash might do better to seek out a free service.
He also warned against widespread foreclosure rescue fraud. Homeowners should never accept help from someone who requests an upfront fee, Fana said. Most times, these individuals guarantee results, then take the money and run. ''Until you sit down with someone'' to look over your paper work, Fana said, ''it's hard to make that kind of promise and you may be getting into a scam.''
Source: MiamiHerald.com