What Are Your Options?

Certified Housing Counselors are available by appointment with Consumer Credit Counseling Service in person or by telephone. If you would like assistance with a housing issue and do not feel comfortable or qualified to handle it on your own, you can use the services of our counselors at no cost to you. Counseling sessions are by appointment only during our normal business hours. To make an appointment call 714 547-2227.

CCCS of Orange County is a HUD Certified Housing Counseling agency. You can verify this at www.hud.gov.

CCCS-OC is NOT a lending institution nor do we have funds available for homeowners. Our function is to educate you about all the options that are appropriate in your situation and help you decide which one to pursue.

CCCS-OC counselors will go over your income, expenses, and debts. Then we will help you determine the best alternatives you have for improving your housing situation within your means.

CCCS-OC can help you contact your current lender to start the process. If you decide to apply with any other lenders or programs, you will need to contact them directly. We do NOT have applications. We also do not refer to any particular lenders or real estate professionals. We will empower YOU to make those decisions.

If you find yourself in a temporary financial crisis, this option could be good for you. Talk to your close friends and loved ones and explain your situation to them. See if they would be willing to loan you the money you need to bring your mortgage payments up to date. If you had a co-signer on the loan, go to that person first and see if he or she can help.

Be honest about how long it will take for you to repay the loan. If you tell a person you’ll pay her in a month and it takes you six months instead — you will only cause a rift in the relationship.

When you are going through a foreclosure, your lender may seem like the last place to turn for a sympathetic ear. But in fact, your lender may prove to be very cooperative. Why? Because they don’t want you to default on your loan any more than you do. Lenders make money by collecting your principal and interest payments, NOT by foreclosing on homes. If you present your circumstances to them along with a reasonable plan that will offer you temporary relief, they may just be willing to help

To present your case, contact your lender and ask for the “Loss Mitigation Department.” Once again, be honest about the amount of time it will take you to get back on your feet. Let the lender know up front if you’d like to suspend payments and for how long. Or perhaps you can make reduced payments for a few months. Either alternative is better than a foreclosure – for you and the lender. Be persistent and keep a written record of your calls, the people with whom you’ve spoken, and all correspondence. Should a settlement be agreed upon, insist upon a written agreement, and make sure you clearly understand the proposal terms before signing.

You may also want to contact a HUD-approved housing counseling agency like CCCS-OC. These agencies can help you interact with your Lender and determine which options best fit your needs.

Perhaps you bought your home when interest rates were high and, therefore, your payment is steep. You may be able to solve your cash flow problem simply by refinancing your debt at a lower interest rate. Shop around for the best deal on a refinance. You might also enlist the services of a mortgage broker and let him do the work for you.

If you are in a home that you simply cannot afford, this may be your best option. Contact a qualified realtor as soon as possible to get your house on the market and be realistic about the price. If you want to sell the home quickly, you may need to offer it for less than what you think it is worth. On the other hand, if you go for top dollar, you may not have any takers and you’ll end up with a foreclosure. If you’re selling the house yourself to avoid foreclosure, check to see if there are any complaints against the prospective buyer. You can check with your state’s Attorney General, the Real Estate Commission, or the local District Attorney’s Consumer Fraud Unit for this type of information.

While a good deal of this information may apply to all homeowners in danger of losing their homes, not all of these foreclosure options may be available to those with a VA or conventional loan.

• Forbearance or Special Forbearance Plans
  Based on your financial situation, these plans may provide for a temporary reduction or suspension of your payments if you have experienced a reduction in income or increase in living expenses.
• Possible Mortgage Modification
  The years of the loan could be extended or the interest reduced in order to make the monthly payments more affordable.
• Partial Claim
  Your lender may be able to work with you to obtain a one-time payment from the insurance fund to bring your mortgage current. The mortgage insurance company can execute a Promissory Note and a Lien will be placed on your property until the note is paid in full. The Promissory Note is due when you pay off the first mortgage or sell the property. You must be able to begin making full mortgage payments at the time of agreement.
• Pre-Foreclosure Sale (Short Sale)
  You avoid foreclosure by selling your property for an amount less than the amount owed. You must use a licensed real estate agent to find a buyer and you cannot under sell the property to family members or friends.
• Deed-in-Lieu
  You may be able to voluntarily “give back” your property to the lender. This won’t save your house, but it is less damaging to your credit report than a foreclosure.