Sumner Home Mortgage
Why would not Bank Your House
Once security was king when it came to borrow money. And your home was typical crown jewel of your security assets. Home ownership gave you instant credibility to a lender that could quickly drag your payment history and deduce from the previous payment plans that yes, you were a reliable borrower, and even if things went south – a lost job, a divorce, an illness in the family – with the house as collateral, the bank will never lose money on your loan.
But now the market is saturated with foreclosed homes, short sales and defaulted Mortgages. The value of real estate in some of the most saturated areas, continuing to go down and have not yet hit rock bottom, leaving both homeowners and business owners in an untenable situation.
According to Robert Sumner, CEO of First National Bank of Pasco (Pasco FNB) near Tampa, Florida, "Everything is down right now, not only do we have fewer home loans, but we are experiencing fewer home improvement loans also."
Sumner states: "Those who still have their homes are simply trying to ride out the storm and wait until the market goes back up, they do not want to throw 'good money after bad "by doing expensive home improvements if they are not getting their value back. Unfortunately, others lose their homes altogether."
Sumner alludes of course to the staggering amount of foreclosed properties currently engulfing the market. And he should know, Florida has one of the highest number of foreclosures in the country right now. Nationally, according to CNNMoney.com, "More than 1.5 million homes have serious criminals and close to foreclosure." What's more, a new study states that "… more than 20% of U.S. homeowners – about 20 million homes – owe more than their homes are worth." [Source: CNNMoney.com]
Not wishing to be a part of the problem, but prefers to remain a part of the solution, now more than ever, banks are eager to stay out of foreclosure business and do what they do best: banking. In other words, your bank will not your house. On the contrary, they prefer to work with you so you keep house.
Banks do not want your home for two basic reasons.
First Bank is not in the property market. They do not want to filter the precious assets of time, personnel and energy in inspecting the residence permit, listing your home to make concessions or worry about maintenance.
In addition there will mow and trim the bushes when you close on the property? Either the bank uses the money to hire someone to do it or leave it alone to become not only an eyesore to the community, but an obligation on the already competitive housing market. Either way, the bank loses money.
Secondly, when the bank takes the house price is drastically reduced. According to Sumner, "When the message is that this is a 'bank owned' property, both brokers and savvy buyers know that they suddenly have the upper hand, they know the bank wants to unload this property, and they now have a much stronger bargaining chip. We typically experience a 30% loss of value of property minute we assume ownership. "
What can you do to avoid missing mortgage payments or lockout, to avoid foreclosure? Sumner lists three simple steps you can take to work with your lender to avoid your own financial meltdown:
1). Reach out before it's too late: If your income has been affected or your debt is simply rolled up to the point where paying your mortgage on it (or even next) month looks less and less likely not bury our heads in the sand, but reach out to your lender and start communicating with them sooner rather than later. They can not help you if they know you are in difficulties.
2nd) Come prepared: The Bank will use the information to help you restructure your payments, refinance the loan or possibly defer a payment or two to help you with a current situation. Be sure to get the latest information about your income, how it has affected your current bills and debt load. Call the bank in advance (or visit its website) will help you assemble a list for each supplier.
3). Prepare Worst: Not all banks can help in any situation. Map of foreclosure, you still have to pay your mortgage on time and Sumner warns you should not expect miracles. But instead of taking over your home bank will prefer to work with you, realistically, to help you avoid foreclosure.
Sumner warns there is no simple fix when budgets are tight and your mortgage continues to be your biggest expenses per month. But he stresses that "avoid the problem is never the answer. "
About the Author
After handling the PR for an Inc 500 company for several years Karla Jo Helms was ready to launch out on her own allowing her to bring her unique take on the world of PR to businesses both large and small. “Public Relations is a powerful tool that can garner wide acceptance and delve into arenas that marketing cannot touch,” says Karla Jo, PR Strategist and Published Author. Helms got her start creating and implementing PR Strategies for entrepreneurs, which helped her develop a keen eye for how to hone in on the best use of PR and technology to increase the Return On Investment of one’s marketing dollars. Her theory on how attaining critical mass by utilizing all areas of PR and Marketing in today’s world allows her to put together complete strategies for clients that attain measurable results. A background in sales, business management and media relations has given her the well-rounded understanding of how to harness the power of PR to communicate to diverse groups of people…the end result being a wider sphere of influence and the invaluable commodity of goodwill garnered on a broad basis for her clients.