In my last article, I addressed the latest chapter in the foreclosure crisis.  Banks and mortgage companies announced last week that they intend to freeze all foreclosure proceedings.  The self-imposed moratorium was due to serious questions that have been raised about the legitimacy of legal documents being filed by some lenders.  Just a few days later, the major banks have now decided that perhaps they have overreacted and now they are poised to begin foreclosing again.

This is extremely confusing, even to those of us that cover financial news for a living.  We are definitely in uncharted territory here.  Those who have been in the process of losing their homes have been on quite an emotional roller coaster.  There have been save your home programs launched by the government that seemed to offer little help.  We then entered into another phase where banks were encouraged to work with borrowers to reach settlements (loan modifications), this also helped very few.  This latest glimmer of hope was that the court system was going to create another window of opportunity for people to have more time, or even a new chance at arriving at a settlement with their lender.

This latest phase in the foreclosure drama involving questions about improper court filings should not and never should have been viewed by borrowers as a long term answer.  There is no scenario I can foresee that will allow people to simply stay in their homes without regard to making a monthly mortgage payment.  Although I have been receiving e mails from people hoping that this might be the case, this is simply a fantasy.  I think that even those with the most generous of hearts have realized that this situation must come to an end soon.

What troubled homeowners may have received from this latest event is simply more time, but not unlimited time.  You may find your bank a little more open minded to the idea of a loan modification than they were a couple of weeks ago.  If you expect much more of a benefit from the latest news, you are being unrealistic.  As it is, some people have been living in their homes for as long as two years since they made their last payment.  As I see it, time is running out and banks will eventually come knocking at the door of every single person delinquent on their mortgage. 

For some people, the absolutely best option is to move out and find a house to rent.  Rent is cheap right now and you can rebuild your credit over time.  If you believe that you can make the payment on your mortgage with some reasonable concessions from your lender, continue to be persistent about a modification.  We have been making available a do-it-yourself mortgage modification kit for just $49.95.

Helping you make the most of God’s money!

James L. Paris
Editor-In-Chief ChristianMoney.com 
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