(PRWEB) June 7, 2005

With mortgage interest prices poised to rise, the U.S. economy teetering in between expansion and uncertainty, and American customer debt nonetheless raging, a lot of U.S. property owners threat foreclosure on their residence – but they don’t have to lose their slice of the American dream, says Andrew Housser, co-CEO of Freedom Economic Network.

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According to the Mortgage Bankers Association of America, 4 percent of mortgages are in delinquency in early 2005. With $ 9 trillion in outstanding U.S. mortgage debt, that areas $ 360 billion at risk of foreclosure.

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“Homeowners can make options – ideally, prior to they purchase a property, but even after difficulties arise – that will permit them to keep a home or at least reduce the harm a foreclosure could have on their futures,” stated Housser, whose business offers debt resolution solutions for individuals in severe debt hardship, particularly those who incurred debt simply because of divorce, job loss, health-related troubles or other traumatic events.

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In many states, foreclosure rates have improved lately (Source: RealtyTrac.com). Housser believes the boost stems from shoppers incurring too considerably debt – a national total of $ 2.1 trillion in revolving debt, plus a lot more than $ 9 trillion in mortgage debt, according to the Federal Reserve. Here, Housser provides ideas for preventing and avoiding foreclosure.

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1. Generate a spending budget and don’t stretch oneself also far. The unexpected can and does take place to millions of Americans every year. “For individuals who reside at the far edge of their means, one particular life occasion can hijack their lives and lead to defaults on bills and/or mortgage payments,” Housser says. The crucial is to build a detailed price range of revenue and expenditures, making positive to have some breathing space to climate an unexpected downturn.

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2. Be cautious with adjustable rate mortgages (ARMs) or interest-only loans. These varieties of loans let borrowers qualify for far more high-priced houses – but beware as rates (and payments) climb. “If you can barely afford the payment on your ARM or the interest-only mortgage, you are asking for problems in a few years,” Housser says. “Give oneself even more budget space with these loans.”

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3. Don’t jump to refinance your house to spend off credit card debt. Numerous people faced with huge unsecured debts that they are unable to pay think about refinancing their property to pay down their credit cards. The problem is that this technique only moves the debt – and puts your house at threat of foreclosure if you are unable to pay. If you are not confident that you can hold up with the larger payments on your residence loan going forward, contemplate debt resolution or another debt relief choice.

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If foreclosure is already on its way, property owners nonetheless have several possibilities, Housser says:

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1. Enter into a forbearance agreement. For a short-term hardship, lenders may grant a forbearance agreement to decrease – or eradicate – payments for a restricted time.

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2. Take into account loan modification. A loan modification seeks a permanent modify to the loan, such as lowering the payment and extending the loan’s term, or incorporating delinquent back payments (if any) into future payments.

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three. Acquire a “deed in lieu” of foreclosure. A “deed in lieu” essentially makes it possible for the borrower to return the title or deed of the house – providing the residence back – to the mortgage holder to steer clear of foreclosure.

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four. Sell the residence. Selling your home might not be best, but it is a way to keep away from foreclosure proceedings on your home and spend back your lender.

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five. Refinance the loan. It could be achievable to refinance your mortgage for a reduced interest price and/or lower month-to-month payment (this is significantly different than refinancing to take money out to spend off credit cards). Even so, if you currently have had late payments on your mortgage, the interest price supplied to you may be too higher to reduce your month-to-month payment.

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“A reputable foreclosure assistance organization, such as a debt resolution firm, can support with these possibilities,” Housser advises. “Check with the Far better Organization Bureau to make positive your chosen business is on the up-and-up.”

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Housser suggests that individuals facing foreclosure be wary of so-referred to as equity skimmers. “If your house is facing foreclosure, you will possibly get solicitations from many folks who are searching to ‘help’ you stop foreclosure by supplying to sell your house for you or by taking ownership of your residence,” Housser cautions. “In most instances, these solicitations are scams attempting to take advantage of people in tough scenarios. The perpetrators are trying to take the equity you have built up in your house appropriate out from under you.”

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Freedom Monetary Network, LLC (http://www.freedomfinancialnetwork.com) offers customer debt resolution solutions by way of its Freedom Debt Relief, Freedom Foreclosure Relief and Freedom Tax Relief divisions. Working directly for the customer, the organization negotiates straight with creditors, and offers an alternative to bankruptcy, credit counseling, and debt consolidation. Based in San Mateo, Calif., Freedom Monetary Network serves much more than three,000 customers nationwide and manages much more than $ one hundred million in consumer debt.

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Editors Note: Housser is available for interviews on subjects pertaining to foreclosure and customer debt. Make contact with Aimee Bennett, Fagan Enterprise Communications, 303-843-9840, aimee@faganbusinesscommunications.com.

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