Foreclosure 101: Negotiating with Lenders

Last week, the implementation of the government’s $300B housing rescue program finally started. This certainly gives hope to a significant number of troubled borrowers. Of course, the success of the mortgage relief program lies in part in the successful negotiations with the lenders.

Since the housing rescue bill is not mandatory for lenders, distressed homeowners should do everything they can to convince the lenders to approve their application. In order to get the lenders to agree, here are some tips that might put you in a better position to re-negotiate your mortgage.

1. Be Prepared – nothing spells “serious” than coming to the negotiation table ready. Make sure that you come prepared with the necessary documents such as Hardship Letter, Statement of Assets and Liabilities and other pertinent documents. Your lender will appreciate your preparedness very much.
2. Be Realistic – you should face the fact that you are there negotiating because you are really having trouble with your mortgage payments. For this reason, you must be sure that you can commit to whatever terms you and your lender agrees on. If not, all your efforts will prove to be futile and you will surely find yourself in the same situation a couple of months down the road.
3. Be Informed – in order to make sure that the negotiation will go smoothly; you should try to brush up on your knowledge about the local foreclosure process. This way, you can weigh the facts more accurately and make an informed decision based on this.

Always remember that the government can only do as much. If you are dead serious about avoiding foreclosure, you should try very hard to ensure that the negotiation with your lender succeeds. If you are still having some trouble, you can always ask a foreclosure counselor to mediate on your behalf.

Related Posts:

• Foreclosure Prevention Tip: Look Ahead
• Negotiating in a Tough Market
• Foreclosure Rescue Scams: How to Spot Them
• Foreclosure Basics: Three Keys to Negotiation Success
• Stopping Foreclosure with a Short Sale