The figures may be shocking, but the number of residents in Ocean, Monmouth and Middlesex counties who are facing the possibility of losing their home to foreclosure is hitting a higher level every day.According to RealtyTrac, an online firm that tracks foreclosures nationwide, there are 4,312 homes in Ocean County, 3,714 homes in Monmouth County and 4,101 homes in Middlesex County that have foreclosure filings pending.
On Feb. 19 the Jackson Township Council sponsored a seminar to discuss the topic that has been on the mind of many people as they deal with the nation's significant economic recession. A group of about 50 residents turned out for the meeting.
"We know that everybody is running into difficult times; as we watch the news every day, it gets worse and worse," council President Mike Kafton said. "This morning I heard that about 5 million people have filed for unemployment."
Kafton said he had spoken with the Ocean County Sheriff's Office the day before and was informed that foreclosure proceedings have increased from between two and three per week to between 10 and 15 per week.
Trish Burke, the sales manager from Center State Mortgage, Freehold, said the interest rate on loans right now is about 5.5 percent. She said the firm is waiting to see how the economic stimulus plan that President Barack Obama recently signed into law will affect individuals who are looking to refinance a mortgage.
Kafton, who works in the real estate field, said the biggest issue people are running into right now is having a credit score of at least 600. He said many people are in debt and/or they owe more than the value of their home.
Presenting information to residents was Darla Keegan of Novadebt, a federal Housing and Urban Development-certified (HUD) nonprofit counseling agency that provides financial advice, suggestions and resources regarding housing, bankruptcy and credit cards to individuals who are in need of those services. The firm is headquartered in Freehold Township.
"We are here to help you with foreclosure," Keegan said. "[We keep up with] what is going on in the economy and what is impacting many people. We get phone calls every day from people who have difficult situations."
Keegan said the firm's counselors take a look at an individual's financial situation and in this way they can get a better determination on what is taking place for that person. From that point, the counselor and the client can move forward in dealing with the situation.
Several counselors from the firm were present at the meeting to assist residents. Keegan said Novadebt counselors do not tell a person what to do. They leave that responsibility up to the individual.
"We also facilitate communication with your lenders, but we don't work for any lenders. "We do [however] have contacts with many of the lenders that are out there," she said.
Keegan said many people are unaware that they can communicate with their (mortgage) lender. She said some people are afraid, ashamed, frustrated or are not knowledgeable about the situation they are facing.
"First and foremost, you should talk to your lender, whether you are current with your mortgage and foresee a problem, or if there is a delay" she said. "[On the other hand] we have calls from people who tell us there will be a sheriff's sale [of their property] in two hours."
Keegan said a counselor may be able to help a person find a solution before the problem gets worse.
"You have to realize that your lender does not know what is happening in your particular situation," she told the audience. "There may be a job loss, a medical problem, a divorce, or whatever may come up. Communication is key to being the first step to avoid foreclosure. The same holds true for credit cards and bills."
She said people who cannot get anywhere with their lender may want to contact HUD. The federal agency has an Internet Web site at www.HUD.gov.
Keegan explained that the foreclosure process can begin as quickly as two months after an individual has trouble making a mortgage payment. She said some lenders have programs that can assist people who find themselves in a difficult situation.
"The lender does not want your home," she said. "There are many homes out there just sitting."
Options may include forbearance, where payments may be added to the end of the loan, while some payments may be able to be suspended or reduced. Another option may be loan modification, in which one or more terms of the loan are changed.
"Beware of scam operators offering you an easy fix, because they will take your money and not solve your problem," Keegan advised those in attendance. "Sometimes they call themselves foreclosure specialists or real estate consultants. They send letters or call you. You do not have to pay for anyone to get you out of a situation,
no matter what they guarantee.
And be careful of bailouts where homeowners surrender the title to their house, a scheme usually aimed at the elderly, or bait and switch, where homeowners think they are signing documents to make the mortgage current, but actually they are signing their house away."
She said the foreclosure process can take between 10 and 12 months, or more. She told people not to panic and to speak with their lender. Keegan told those in attendance to never sign a blank document and to not pay a fee for assistance.
Novadebt, which has offices on Willowbrook Road, Freehold Township, may be reached at 866-472- 4557 or at www.novadebt.org .
For a list of additional HUD-approved counseling agents, visit www.hud.gov/offices.
After the meeting, Kafton said there are many people who are still working and making a good salary, but who still find themselves behind in their mortgage payments.
"Maybe the president's new financial package will help to save many of these houses from foreclosure, but we just have to wait to see how this all works out," he said.
How to protect yourself from scams
Know what you are signing. Read and understand every document you sign. If a document is too complex, seek advice from a lawyer or an approved, trusted financial counselor. Never sign documents with blank spaces that can be filled in later. Never sign a document that contains errors or false statements, even if someone promises to correct them later. Get promises in writing. Oral promises and agreements relating to your home are usually not legally binding. Protect your rights with a written document or contract signed by the person making the promise. Keep copies of all contracts you sign. Make your mortgage payments directly to your lender or the mortgage servicer. Do not trust anyone else to make mortgage payments for you. Be very careful about signing over your deed. Foreclosure scams often require you to sign over ownership of your home to a con artist or another third party. Never sign over your deed without getting the advice of your own lawyer, financial advisor, or other independent person that you know you can trust. Understand the terms of the deal you are making. By signing over your deed, you lose your rights to your home and any equity built up in the home. Report suspicious activity to the Federal Trade Commission and to your state and local consumer protection agencies. Reporting con artists and suspicious schemes helps prevent others from becoming victims.
Source: www.hud.gov/foreclosure
How to find legitimate help for your financial problems
Contact your mortgage lender or mortgage servicer as soon as you think you are unable to make your mortgage payment. Lenders are often in the best position to help, especially if you are current on your loan or not seriously late on your payments. Your mortgage lender or mortgage servicer may be able to identify options to help you bring the loan current or to modify your loan. Contact a legitimate housing or financial counselor to help you work through your financial problems.
Housing counseling agencies in Monmouth County:
Affordable Housing Alliance of NJ
59 Broad St., Eatontown
732-389-2958
Novadebt
225 Willowbrook Road, Freehold
732-409-6281
Faith Fellowship CDC
732-727-9500, Ext. 1171 or 1704
Monmouth County social services agencies (Medicaid, food stamps, child support, emergency assistance, employment support):
Kozloski Road, P.O. Box 3000, Freehold, NJ 07728, 732-431-6000
Explore loan workout solutions with your lender
First and foremost, if you can keep your mortgage current, do so. But if you find you are unable to make your mortgage payments, you might qualify for a loan workout option. Check with your lender to see which option may be available. Some options may not apply to your loan if it is not insured by FHA.
If your problem is temporary - call your lender to discuss these possibilities: Reinstatement: Your lender is always willing to discuss accepting the total amount owed in a lump sum by a specific date. Forbearance may accompany this option. Forbearance: Your lender may allow you to reduce or suspend payments for a short period of time and then agree to another option to bring your loan current. A forbearance option is often combined with a reinstatement when you know you will have enough money to bring the account current at a specific time. The money might come from a hiring bonus, investment, insurance settlement, or tax refund. Repayment plan: You may be able to get an agreement to resume making your regular monthly payments, plus a portion of the past due payments each month until you are caught up.
If it appears that your situation is long-term or will permanently affect your ability to bring your account current - call your lender to discuss options: Mortgage modification: If you can make payments on your loan, but don't have enough money to bring your account current or you can't afford your current payment, your lender may be able to change the terms of your original loan to make the payments more affordable. Your loan could be permanently changed in one or more of the following ways: Adding the missed payments to the existing loan balance. Changing the interest rate, including making an adjustable rate into a fixed rate. Extending the number of years you have to repay. Partial Claim: If your mortgage is insured, your lender might help you get a one-time interest-free loan from your mortgage guarantor to bring your account current. You may be allowed to wait several years before repaying this loan. You qualify for an FHA partial claim if: Your loan is between 4 and 12 months delinquent. You are able to begin making full mortgage payments again. When your lender files a partial claim, HUD will pay your lender the amount necessary to bring your mortgage current. You must sign a promissory note, and a lien will be placed on your property until the promissory note is paid in full. The promissory note is interest-free and is due when you pay off the first mortgage or when you sell the property.
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