Foreclosure Assistance

Timeline
No one ever expects they will lose their home, but it does happen, which is why you need to work with your lender or a counselor early in the process. Below is a basic timeline for foreclosure, showing how quickly non-payment can become losing your house if you don’t seek help.

After your first missed payment, the collections department for your lender will contact you. At this point, you have many options to work with your lender or a counselor to bring your payments current or to refinance.

After your second missed payment, your account will be turned over to the loss mitigation department. This is a division of the mortgage company that will work with you on an acceptable plan to get you back on track with your mortgage payments. At this point, you still have many options open to you. You still have time to work something out with your lender. A housing counselor can still help.

After a third missed payment, a third party trustee or attorney takes over your delinquent account, sending you a Notice of Default stating that the property will be sold 90 days from the date the Notice was filed and recorded. If you do not pay the specified amount or make some type of arrangements by the given date, the lender may begin foreclosure proceedings. They are unlikely to accept less than the total due without arrangements being made if you receive this notice. You will incur all attorney fees as part of your delinquency. At this point, the mortgage company will not send you any more letters. It is now totally up to you to contact them or a U.S. HUD certified housing counselor. Unless you act quickly, your house will be sold at auction on the date specified.

Options to Avoid Foreclosure

Repayment: Plan where you pay a full month’s payment plus a partial payment, meaning a portion of the deferred delinquent amount is added to the normal monthly mortgage payment. Distributes your delinquent payments over a period of time, usually no more than 10 months.

Forbearance: Similar to a repayment plan; lender agrees to a modified monthly payment for several months allowing the borrower to catch up.

Modification: This plan involves more work and may reduce or fix your interest rate, change your term from 30 to 40 or 50 years, or add the delinquent amount to your current amount and re-amortize (or re-schedule your payments). It is a permanent change in one or more of the terms of the mortgage loan, allowing the loan to be reinstated to a “current” status and resulting in a more affordable monthly mortgage loan payment. Past due interest and escrow are added to the new unpaid principal balance and re-amortized over the remaining life of the loan.

Partial/Advance Claim: This is a second loan with no interest, or very low interest that is repaid after the first loan is paid, but this is available only with insured mortgage loans, such as FHA loans. This option allows up to 12 months of past due accrued mortgage payments to be included in the second mortgage.

Refinance: The lender will offer a new loan which may add an additional borrower. There must be adequate equity in the property. This cannot be done if the value of the home is less than the amount owed to the lender.

Fannie Mae HomeSaver Advance: A low interest rate loan provided by the first lien loan servicer to bring current a customer’s delinquent first lien loan. The loan repaid over a 15 year term, with payment and interest accrual deferral during the first 6 months after the advance. Available only on most Fannie Mae loans.

Home Affordable Modification Program: Reach a monthly housing payment that is no more than 31% of the borrower(s) total monthly gross household income. Participating servicers and investors will work with eligible qualified borrowers to reach a more affordable mortgage payment through extending the term of the loan, lowering the interest rate, capitalizing delinquent mortgage payments, and/or forbearing principal.

Options to Not Keep Loan or Home
Sell the property: Best option if the borrower cannot afford the mortgage payment and the house is worth more than the amount owed. In the back of this workbook under Tools there is a worksheet “What’s my House Worth?” to help you decide on a competitive sales price. Other considerations include the condition of your home and how much time do you have.

Assumption: If you find another borrower willing and qualified to take over your mortgage and your home, they may assume your mortgage. The new borrower must meet the lender’s criteria.

Deed in Lieu: In some cases the lender will take back your property instead of holding you responsible for the mortgage loan. Allows you to voluntarily transfer legal ownership of your property to your investor. Requires investor approval. This option will considered, in most cases, only after the property has been on the market for 90 days. There may be tax consequences.

Foreclosure: This is sometimes the only option for a borrower to accept. After five years, the borrower may qualify for a new mortgage. There are tax consequences to foreclosure and credit challenges, as well.

>Short Sale (pre-foreclosure sale): When the borrower owes more than the property is worth, it may be best to sell the property. The lender and mortgage insurer must agree to this option. Allows you to sell your home and use the proceeds to pay off the mortgage if you are unable to maintain payments, even if the home’s market value is less than the total amount owed.

Bankruptcy – Chapter 13: For more information on bankruptcy, visit www.azb.uscourts.gov.

Resources

Homeowners HOPE Hotline
(888) 995-HOPE
www.hopenow.com

Utah Foreclosure Prevention
(888) 826-9790
(801) 978-3333
www.utahforeclosureprevention.com

Approved Housing Counselors

CEDAR CITY HOUSING AUTHORITY
Address: 364 South 100 East, Cedar City, Utah 84720
Phone: 435-586-8462 Fax: 435-865-9397
Email: heidi@cedarcity.org

AAA FAIR CREDIT FOUNDATION—CENTERVILLE
Address:95 East Pages Lane, Suite A
Located at LDS Family Services, Centerville, Utah 84014
Phone: 800-351-4195 Toll Free: 800-351-4195
Email: housing@faircredit.org
www.faircredit.org

NEIGHBORHOOD NONPROFIT HOUSING CORPORATION
Address:195 West Golf Course Road, Suite 1, Logan, Utah 84321
Phone: 435-753-1112 Fax: 435-753-6112
Email: tammy@nnhc.net www.nnhc.net

USU—FAMILY LIFE CENTER—HFC
Address:493 North 700 East, Logan, Utah 84321
Phone: 435-797-7224 Fax: 435-797-7432
Email: flchfc@usu.edu

CORNERSTONE FINANCIAL EDUCATION
Address:3340 Harrison Blvd., # 120/#130, Ogden, Utah 84403
Phone: 801-621-5600 Toll Free: 800-336-1245
Fax: 801-621-5610
Email: ogdenoffice@csfedu.org

COMMUNITY ACTION SERVICES
Address:815 South Freedom Blv., Suite 100, Provo, Utah 84601
Phone: 801-691-5200 Fax: 801-373-8228
Email: drusaw@communityactionuc.org
www.communityactionuc.org

NEIGHBORHOOD HOUSING SERVICES OF PROVO
Address:39 W 300 N, Provo, Utah 84601
Phone: 801-375-5820 Fax: 801-375-5966
Email: sbehunin@nhsofprovo.org
nhsofprovo.org

AAA FAIR CREDIT FOUNDATION
Address:230 West 200 South, Suite 3104, Salt Lake City, Utah 84101
Phone: 801-483-0999 Toll Free: 800-351-4195
Fax: 801-364-8885
Email: housing@faircredit.org

COMMUNITY DEVELOPMENT CORPORATION OF UTAH
Address:501 East 1700 South, Salt Lake City, Utah 84105
Phone: 801-994-7222
Email: stephanie@cdcutah.org
Website: www.asite.com

NEIGHBORWORKS SALT LAKE
Address:622 W 500 North, Salt Lake City, Utah 84116
Phone: 801-539-1590 Fax: 801-539-1593
Email: info@nwsaltlake.org
Website: www.nwsaltlake.org

SALT LAKE COMMUNITY ACTION PROGRAM
Address:370 E South Temple Suite 260, Salt Lake City, Utah 84111
Phone: 801-359-2444 Fax: 801-355-0859
Email: sabegglen@slcap.org
Website: www.slcap.org

CONSUMER CREDIT COUNSELING SERVICE OF UTAH
Address:720 South River Road C-235, St. George, Utah 84770
Phone: 435-986-9223 Toll Free: 800-451-4505
Fax: 435-986-9410
Email: cccs@cccsnevada.org
Website: www.cccsutah.net

Approved Housing Agencies

CEDAR CITY HOUSING AUTHORITY Address: 364 South 100 East, Cedar City, UT 84720 Phone: (435) 586-8462 Fax: (435) 865-9397

AAA FAIR CREDIT FOUNDATION—CENTERVILLE
Address: 95 East pages Lane, Ste. A, Centerville, UT 84014
Phone: (800) 531-4195
www.faircredit.org

AAA FAIR CREDIT FOUNDATION—KAYSVILLE
Address: 320 South 500 East, Kaysville, UT 84037
Phone: (800) 35-4195
www.faircredit.org

AAA FAIR CREDIT FOUNDATION LAYTON
Address: 875 East Highway 193, Layton, UT 84041
Phone: (800) 351-4195
www.faircredit.org

NEIGHBORHOOD NONPROFIT HOUSING CORPORATION
Address: 195 West Golf Course Rd, Ste. 1, Logan, UT 84321
Phone: (435) 753-1112 Fax: (435) 753-6112
www.nnhc.net

UTAH STATE UNIVERSITY—FAMILY LIFE CENTER HOUSING AND
FINANCIAL COUNSELING SERVICES
Address: 493 North 700 East, Logan, UT 84321
Phone: (435) 797-7224 Fax: (435) 797-7432
www.flchfc.usu.edu

AAA FAIR CREDIT FOUNDATION—OGDEN
Address: 3159 Grand Ave., Ogden Weber Community Action Part Bldg.,
Ogden, UT 84401
Phone: (800) 531-4195
www.faircredit.org

COMMUNITY ACTION SERVICES
Address: 815 South Freedom Blvd., Ste. 100, Provo, UT 84601
Phone: (801) 373-8200 Fax: (801) 373-8228
www.communityactionuc.org

NEIGHBORHOOD HOUSING SERVICES OF PROVO
Address: 39 West 300 North, Provo, UT 84601
Phone: (801) 375-5820 Fax: (801) 375-5966
www.nhsofprovo.org

AAA FAIR CREDIT FOUNDATION
Address: 230 West 200 South, Ste. 3104, Salt Lake City, UT 84101
Phone: (801) 483-0999 Fax: (801) 364-8885

COMMUNITY DEVELOPMENT CORPORATION OF UTAH
Address: 501 East 1700 South, Salt lake City, UT 84105
Phone: (801) 994-7222 Fax: (801) 994-7220
www.cdcutah.org

NEIGHBORWORKS SALT LAKE
Address: 622 West 500 North, Salt Lake City, UT 84116
Phone: (801) 539-1590 Fax: (801) 536-1593
www.nwsalt lake.org

SALT LAKE COMMUNITY ACTION PROGRAM
Address: 370 East South Temple, Ste. 260, Salt Lake City, UT 84111
Phone: (801) 359-2444 Fax: (801) 355-0859
www.slcap.org

HOUSING AND OPPORTUNITY THROUGH POSITIVE EMPOWERMENT (HOPE)
Address: 1070 West 160 South #B, St. George, UT 84770
Phone: (435) 632-7832 Fax: (435) 603-1188
www.housingandopportunity.org

CONSUMER CREDIT COUNSELING SERVICE OF
SOUTHERN NEVADA DBA CCCS OF UTAH
Address: 720 South River Rd. C-235, St. George, UT 84770
Phone: (435) 986-9223 Fax: (435) 986-9410
www.cccsutah.net