I know that I am to join the thousands of other former homeowners in the “good ol' U.S.A” in the search for solutions. As we all know however; to find a solution, one must analyze the problem.
There are many ways to look at our foreclosure problem in this country, depending on which side you're on. There is the lender (or bank) and there is the property owner, referred to as “the borrower.”
The Lender's Side of the Story
You borrowed money from us, and used your home or property for collateral. You (the borrower) signed an agreement to pay off the amount you borrowed, on terms listed in the agreement. You didn't keep your part of the agreement, so now we are taking your house to recover the money we loaned to you.
I know there's more to it than that (about 50 pages of legal terms), but in a nutshell that's pretty much how it works.
The Borrower's Side of the Story
You (the lender) gave me an attractive offer, that would put cash in my pocket, and clean up my credit. The interest rate you ( the lender) are charging me can be lowered if I refinance in about a year, because my credit score should be improved by then.
You (the lender) were able to get me more money than my house was worth, without coming to see it. All I had to do was send a photo of the front of the house. You (the lender) were kind enough to have someone meet me with about 50 pages of mind boggling legal terms for me to sign. You (the lender) gave me the cash, which was used in part to clean up my credit, repair the house, and for investments. I paid to you as we agreed, and you (the lender) raised my payments to a level that I could no longer afford, so as a year went by, I asked to refinance, and was declined. I the borrower, was trying to work with you (the lender) to work things out to benefit both of us. I also found that paying on time and paying off creditors did NOT improve my credit, nor did it qualify me to refinance or lower my interest rate.
I have lost my job since, and I am now even less able to qualify for help.
As I write this article, I am sure you or someone you know has a very similar story. What I have found in my experience so far, is that the lender will not choose to work with you until the point of foreclosure or pre -foreclosure. I also believe the lender would be better off to work with the borrower and agree to terms of smaller payments over a longer time period than to be stuck trying to sell a house which is only worth a fraction of the loan. Unfortunately things don"t quite work that way.
