Most articles I have read on how to stop Foreclosure say the first step is to contact your lender. Tell them your situation and try to negotiate terms to bring your mortgage current.

That is a good first step, but how much help you get depends on the lender. Many will not negotiate with you and instead insist that you pay the arrearages in full. If you could do that, then you would not be facing Foreclosure to begin with.

Plain and simple, their offers to help are most often empty and only spoken to portray a sense of good will. In reality, they are only concerned with getting their money, not with the circumstances that put you behind on your mortgage payments.

Yes that sounds harsh, but considering the fact that losing your home to Foreclosure is a devastating situation for the home owner. When they are told their lenders will help, only to find out that there is little chance for the Foreclosure sale to be postponed, where are they to turn for real help?

I was on a 3-way phone call with a home owner who wanted to make arrangements to pay off her arrearages. The lender apparently had a script that the loss Mitigation department supervisor was obviously reading. He could not answer any questions that were not referenced on the script and when he got to the bottom, he started over from the top. I told the home owner we were getting nowhere with that and it was time to turn this over to our own loss Mitigation department, which she gladly did.

On the other side though, investors are having fun buying those homes at reduced costs. They look for homes that are close to the Foreclosure sale and initiate a short sale as quickly as they can. If the sale is too close, an investor can sometimes get the home owner to drop the price enough that their equity is stripped away.

Look at how some states handle Foreclosure prevention. Companies who have a sincere desire to help the home owners get back on track and stay in their homes are not allowed to operate in Colorado. That is because most companies who perform loss Mitigation collect a fee up front for their services. There are about 12 known non-profit organizations in Colorado who are allowed to operate there because they claim not to collect fees up front.

However, by the time the arrearages are caught up, the home owners will most likely have nothing left to pay the loss Mitigation fees. So who pays the non-profits for performing those services? Most likely the government pays the non-profit organizations through the use of your taxes.

Instead of allowing for-profit companies to operate in the state, Colorado has opened their arms to real estate investors to buy the foreclosed homes, not giving much thought to how that affects home the owners. Property-thirsty real estate investors, otherwise known as sharks, are backed by the state government. How do you as a home owner feel about that?

Oh and it is not just Colorado. Other states are starting to join in too. Where this anti-Mitigation mindset stops is unknown. Privately owned companies keep our economy growing, yet at the time when they are needed the most, they are shut out. I have nothing against real estate investing and think it can do good for both the buyers and sellers. However, when it is favored over helping people keep their homes after suffering hardships, that is when I think the investing is wrong.

At least most states still allow companies to get paid for their third party negotiations. Loss Mitigation is a service in very high demand with far too few consultants to reach out and help those home owners in distress.

If you ever wondered how you can help home owners stop their Foreclosure, now is a great time to check out a reputable company that performs loss Mitigation services with a 97% success rate. Together we can help keep more home owners in their homes and out greedy hands. I look forward to seeing you there.

Jim Hutchinson

For more information, visit www.PreventForeclosure.net

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