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This Bailout Is For Families (Not Banks)!

This Bailout Is For Families (Not Banks)!

There is a slight upside to living in a state with one of the highest foreclosure rates in the country. Michigan was one of ten states chosen to receive part of $2.1 billion in order to combat rising foreclosure rates. Our hefty $154.5 million (chump change compared to California’s $699 million and Florida’s $418 million) portion will ideally help about 16,000 struggling families in three different ways according to this article.

1. The state plans to use some of these funds to help unemployed families make their house payments, giving them a subsidy of up to $750 a month for up to a year.

2. For those families who are lucky enough to find a new job, and are able to once again make their payments, they state will dole out up to $5,000 to help them with their back payments.

3. If the lending bank agrees to match the payment, up to $10,000 could go to paying down your mortgage principle.

The downside to this is that while some people facing a Michigan Foreclosure will get the help they need, there will inevitably be many families left struggling to stay afloat. We here at Great Lakes Home Solutions can’t offer you a government bail out, but we may be able to help in other, more permanent ways. If you have a hardship and can no longer afford your payments, give Emily a call. She’ll help you choose the right option for you.

Holly

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Live From Las Vegas

This week I’m at a conference in Las Vegas. Sound like fun? Yeah, I wish there were time for fun!

3-4 times a year I gather with the very top foreclosure specialists around the country. We meet for days (and nights) and talk about all the things that are happening in our industry. We talk about what works, what doesn’t work, what’s new (the bailout?), and most importantly, the best strategies for negotiating with YOUR lender

Fortunately, the saying “what happens in Vegas stays in Vegas” does not apply here. I’ll be back at the office later this week, ready to pound harder on your lender to help get you out of your nasty Michigan foreclosure. Can you imagine a room full of Bank Bullies?

Joel

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Government Bailout Programs, Update III

Not a day goes by when we don’t get several calls from homeowners asking about the government bailout programs that have been announced.  Searching on “bailout” on our BLOG will show that this is the third update we’ve written.

We learn a little more every week.  There is still nothing earth shattering to report, but here’s what we do know so far.

  • Your lender must be willing to participate in the program.  Most of the major lenders are still not participating according to this article because they either haven’t figured out how it works and how to get the money, or they simply don’t have the people on staff to handle the requests for workouts.
  • You must have enough income currently to qualify.  The above report says you’ll need to spend no more than 31% of your gross monthly income on your mortgage, insurance and taxes, while I’ve seen other reports that put this up to 40%.
  • Your lender must be willing to discount your loan amount to 90% of the current market value of your house.  For example, if you’ve refinanced when the market was good, say to $130k, but your house is only worth $100k now, your lender has to be willing to accept $90k and write off $40k.  How likely is that?  No one knows yet.
  • If your lender has already foreclosed, and you are in the redemption period in Michigan (typically 6 months), none of these programs are available to you. Although you can still remain in the house, and can try to sell it via a short sale (with our help, at no charge or course), bailout programs will not apply to you.  Why?  Because you don’t own the house any longer – your lender does.
  • Many lenders are offering their own programs, but they generally have tighter requirements than the proposed bailout options we’ve seen.

Our advice at this point? Well, it completely depends on your specific situation.  Call us, we’ll update you on what we know, and do what we can (never a fee) to get you back to better times as quickly as possible.

Finally, we’re naturally skeptical of the government just like you are, even in these times of change with a new administration coming into power in 2009.  We encourage you not to waste any time waiting for the government and hoping they have the end-all cure-all program to help.  As the above article points out, it’s a lot of money, but it’s not going to be enough to help everyone.  You need to look at all of your options.

Joel

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Government Bailout Programs, Update

Emily wrote a few weeks ago on the Government Bailout and since we know people are anxious for an update, I thought I would write on this again.  The update is that there is no update.  In fact, I am not the only one saying so, just check out this story.

The best advice is still what Emily said a few weeks ago: if you are behind on your house payments and facing a Michigan foreclosure, the best option is to act like the Government Bailout option isn’t an option because it isn’t, yet.

The Michigan foreclosure process can happen so fast that you don’t have time to wait for a nebulous program with an unknown implementation date.

Give our team a call.  We can discuss with you the options you *do* have today so you can have a more certain tomorrow.

Ann

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Government Bailout

My phone is as busy as ever and it seems the most common question I’m hearing lately is “how does the government bailout help me”.  Well, here’s my answer: I don’t know, and honestly, it’s anybody’s guess at this point.

Here are things my team is fairly certain of:

  • Once you’ve been foreclosed on, since you don’t own the house any longer, there will be no options available to you to keep your house.  Of course a short sale will still be an option.
  • If this program is like the many that have been rolled out before, only a small percentage of homeowners will qualify.
  • I for one don’t make my financial decisions based on promises from the government as I really don’t want my financial future in their hands.

It’s going to take a while before we hear how this is going to impact homeowners.  Even though it seems like there should be enough money out there now to help every homeowner, there isn’t.  My best advice at this time is to act like that option isn’t even available yet, since it isn’t.

Of course when my team figures out exactly how the program will be implemented, we’ll be sharing that information with you right here on this BLOG.  If you haven’t yet, you can subscribe to future posts so you can stay in the loop.

Emily

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