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Special Issues- The Consumer Side to Foreclosure

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Special Issues- The Consumer Side to Foreclosure

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    1. Special Issues- The Consumer Side to Foreclosure An Investor’s Perspective….

    2. In the beginning….. 20% down Great credit Assets Good property Fixed rates Good solid underwriting practices

    3. Moving along…… Harder to save money so the industry adopted smaller down payments Good credit Good house Some assets

    4. Now were moving…. Industry wants quicker turn around time they adopt automated underwriting systems (black box) Still less down Some seller concessions Decent credit Good property Few assets

    5. Ok still not reaching everyone.. Industry develops new mortgage products: Adjustable mortgages 80/20 80/10/10 Interest only’s

    6. Now we’re cooking… How about reaching a few more people: No doc loans

    7. Where New Hampshire Housing stood during this time…….. Still required 3% down payment At least 1% of borrowers own money into transaction Fixed rate

    8. Ok let’s fast forward a little…. The folks in the 80/20 had an adjustable second mortgage, the rate went sky high The folks in the interest only had to start making principle payments The folks in the adjustable got into the loan on a teaser rate and the rate went up. And the folks who had equity took out equity lines of credit to pay off credit cards!!!

    9. Ok so why are we here.. Everyone assumes that the ace in the hole will be to sell the property if things get that bad. (after all that’s their piggybank)

    10. But if you took the “bacon” out of the pig already Your little piggy won’t go to market!!! (The pig after you bought gas and took the equity line!)

    11. Causes of Delinquency and Foreclosure Job loss Illness – large medical expenses Marital problems / Divorce Unexpected major repairs Financially overextended / Poor money mgt. Substance abuse Death

    12. Prevention….. Early communication with Lender Written documentation Don’t hide and panic Prepare a budget Stay in the home Contact a Housing Counseling Agency Beware of scams Do not sign anything you do not understand

    13. Alternatives Short-term repayment plan Long-term repayment plan Loan modification Partial or advance claim Straight sale Assumption Pre-foreclosure sale Assignment of loan Refinance Other New Hampshire Housing programs

    14. Philip S. Rader Divorced Borrower Initiative Refinance divorced borrowers with minor children Retain principal residence in connection with the divorce Cash out for former spouse Loan must meet New Hampshire Housing purchase price and income limits

    15. EHRL (Emergency Home Repair Loan) Existing New Hampshire Housing customers only Emergency not covered by homeowners insurance Max loan $15,000 Affordable rates Originated by New Hampshire Housing

    16. HomeAccess Assist borrowers make the home accessible for a disabled household member Borrower unable to obtain a Home Equity loan from a conventional lender Borrower does not have to have an existing New Hampshire Housing loan Max loan amount of $25,000 Affordable rates

    17. Foreclosure at New Hampshire Housing Who are the players? New Hampshire Housing Servicing Division Located in Bedford, NH 7,700 mortgage loan portfolio Dovenmuehle Mortgage (DMI) Largest subservicer Located in Lake Zurich, IL 1.888.781.8634 – customer service 1.888.395.3997 – loss mitigation

    18. Responsibilities of New Hampshire Housing Oversight of DMI (vendor) Customer Service Liaison between Borrower & DMI Compliance with: Mortgage insurance companies Government insured programs Legal Compliance

    19. Responsibilities of Dovenmuehle Mortgage Billing and collection Loss Mitigation Foreclosure Maintenance of borrower escrow account Escrow disbursements (taxes, insurance) Customer Service Escrow analysis

    20. Contacts Ron Gaudio Manager, Loan Servicing New Hampshire Housing rgaudio@nhhfa.org 603.310.9203 Theresa Broyer Mortgage Servicing Specialist New Hampshire Housing tbroyer@nhhfa.org 603.310.9216

    21. Don’t put your house on the line..

    23. Thank you

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