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Sep 24, 2008 4:56 pm US/Eastern
Expert: Struggling Homeowners Have Options
PITTSBURGH (KDKA) ―
Notice the "for sale" signs out on many homes these days. Some of those homes are foreclosures -- homes where the buyer could no longer make the monthly mortgage payments.
"A lot of residential foreclosures -- dramatic -- I'd say it's been increasing about 20 percent," Joseph Nigro, a local attorney, told KDKA Money Editor Jon Delano.
"20 percent?"
"Yep."
"Over the last year?"
"Yes."
Nigro represents homeowners and mortgage companies -- and he says when property owners cannot make their monthly payments, it's time to talk to their mortgage lender.
"Be upfront with them. Let them know -- I am having problems. I need relief."
Hoddy Hanna at Howard Hanna Real Estate both sells homes and provides mortgage financing to homeowners.
"Contrary to opinion, the lender does not want to foreclose on your house. They don't want to. They don't want to," Hanna told Jon Delano. "They don't want to foreclose because it's a negative to them."
But lenders do want their money -- so foreclosure looms if a homeowner misses a mortgage payment.
"The key here is you've got to contact the mortgage company. If you just let it slide then you are on the road to litigation with the mortgage company," says Nigro.
Hanna says a lot of Pittsburgh area homeowners can bring down their monthly payments through refinancing to a lower interest loan.
"There is plenty of mortgage money available for qualified people."
That's particularly true in this region because -- unlike most of the country -- property values here have not declined.
"The prices have stayed steady or gone up gradually, and that has been a big, big plus."
And with home values stable here, if you can't refinance, homeowners can always down-size -- sell their home -- and pay off their mortgage.
But if the worst happens -- a foreclosure complaint -- attorney Nigro has another suggestion -- file Chapter 13 bankruptcy -- it stops the sale of your house immediately.
"Chapter 13 bankruptcy filing will definitely put a stay on any further action by the mortgage company," Nigro adds.
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