Keeping your home from foreclosure

WASHINGTON (MarketWatch) -- The Treasury and the Federal Deposit Insurance Corp. are working with the Federal Reserve and Fannie Mae to prevent millions of home foreclosures, Treasury Secretary Henry Paulson said Tuesday in an exclusive interview on "Charlie Rose" on PBS airing Tuesday night, according to a transcript of the interview. Paulson said the Treasury is readying plans to buy troubled mortgage assets from banks and other investors. "There is clearly more that can be done, needs to be done," he said. "We are looking in the millions. And we need to do everything we can to minimize that," Paulson said. The actions by the FDIC to guarantee bank debts are already working, he said. "The credit freeze is beginning to melt."

If you have fallen behind on your mortgage payments or if you have started to receive delinquency notices in the mail don't panic! There are people who want to help you and you do have options available to keep your home from going into foreclosure. Also, be aware that there are people who want to help themselves and they will try to take advantage of your situation. It's their intention to try to take your money or your home. The best way for you to get your finances under control is to create a budget.

1. Take a good look at your expenses and see what areas you can cut back on and if there are expenses you can cut out all together--even if it's just for a few months to get you through.


2. Make your house payment the most important payment. Pay that every month before every thing else.If you feel that you are getting into trouble and delinquency notices are coming in the mail, contact your lender immediately and see if you can work something out.

Don't feel like you have to take care of the problem by yourself or that the situation is hopeless. Your lender does not want to foreclose on your home, it will cost them too much money to do that. They would rather find an option that works out for both of you. Here are some options that you have:

• The insurer can pay the amount that you are behind on in exchange for a promissory note from you and you pay him back over time.
  Ask to have the loan changed to reduce the interest rate or extend the term of the loan and add the missed payments to the existing balance.


• Pay the entire amount that is over due.
  Convert an adjustable rate mortgage to a fixed rate mortgage.


• Forbearance agreements --payments are temporarily delayed.
  The FHA Secure Plan--If you are delinquent because of an interest rate reset you can refinance into an FHA-insured mortgage through The Federal Housing Administration (FHA) To check out information on the FHA refinancing guidelines:
  http://fha.com/
  

Also be aware that there are foreclosure scams that are manifesting themselves like greedy specters. The most common ones are people offering to help you negotiate with your lender for a huge amount of money or they offer to make your payments and you can stay in your house until you can buy the home back from them. What you don't realise is that they are taking possession of your home with the equity that you have in it and sure you get to stay in your home but, your paying rent now! The scam artist owns your home and the equity. Don't feel pressured into signing any agreements without a lawyer looking it over. There are legitimate housing councilors that will help you.You can contact a councilor at the Department of Housing and Urban Development :http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfmAs always, check out a company for complaints before you do business with them at The Better Business Business Bureau at:http://www.bbb.org/