(NAPSA)—If the housingcrisis has you worried about losing your home, you may want to find outif you're at risk and develop a plan to deal with yoursituation. Mortgage Maintenance Matters Think of your mortgageas if it were your car; regular maintenance is the best way to avoid unexpected problems. If you’re unclear about the terms of your loan, facing a rate reset you can’t afford or behind on payments, contact your lender or the NeighborWorks nonprofit group at (888) 955-HOPE (4673) or go online to www.homesafepmi.com. You may be surprised to learn aboutall the programs available to help you preserve your credit and save your home. Oiled Up And ReadyTo Roll If your mortgage is in good shape, you maystill be concerned about the long-term value of your home, as prices are declining in many parts of the country. “We studied the Office of Federal Housing Enterprise Oversight’s [OFHEO] house price index over a 20-year period from 1986 to 2005 and found that owning a homefor 10 years or longer during that period produceda positive return on investment 99.6 percentof the time. Owning for five years produced a positive return 95 percent of the time,” says David Katkov, president of PMI Mortgage Insurance Co. “Our calculations were based on index results, so individual results may vary, but what this shows is that homes can be an excellent way to build wealth if you treat them as a long-term investment.” Warning Lights If you have the ability to make your payments but see that a rate reset is in your future or have missed payments due to an unforeseen problem in your past, you still have options to save your home. “If you’ve missed mortgage payments because you lost your job, got sick or had some other unforeseen problem,it’s important to contact your lenderright away,” said Rick Harper, vice president of Program Services for the Con- Moving quickly to take advantage of all the available assistance programs can help you stay in your home. sumer Credit Counseling Service of San Francisco. “There are a number of options available that can help you save your home, but you can only take advantage of them by contacting your lender or a nonprofit group like HOPE NOW. Your options will decrease the longer you wait.” eReinstatement/repayment plans—If you've missed payments but have the ability to pay your bills going forward, you can talk to your lender about a reinstatement plan. These plans allow you to repay missed payments over time and bring your loan current. Mostlenders allow you to slightly increase monthly payments until you’re caught up or extend the length of your loan. Forbearance agreements— Forbearance agreements allow those facing a temporary financial crisis to enter into an agreement that suspends their mortgage payments for a set period of time until the financial hardships are resolved. eLoan modifications—In a loan modification, your lender agrees to revise the terms of your loan in order to makeit easier for you to afford your payments. Broken Down On The Roadside If your mortgage is beyond repair, you still have options. Far too often, borrowers who can’t make their payments simply give up on their home and go quietly into foreclosure. But there are programsavailable to help you sell your home—evenfor less than you owe—andavoid foreclosure. Foreclosure should always be a last resort because it impacts your credit score for as long as seven to 10 years and maylimit yourability to finance car purchases, student loans, credit cards and new mortgages. Employers, landlords and imsurance companieswill also often check your credit before hiring you or signing an agreement with you. To avoid the pitfalls of foreclosure, talk to your lender about any one of the following work-out options: Loan assumptions—In a loan assumption, your lender allows a qualified borrower to assume the terms of your home loan. You may have buyers, family members or friends willing to assumeyourloan. Pre-foreclosure sales—A pre-foreclosure sale is far less damaging to your credit than a foreclosure. In a pre-foreclosure sale, you sell your home—even at a loss— and the lender agreesto accept less than the total amount owed as complete or partial satisfaction of your loan. In somecases, the lender may ask that you sign a note for someportion of the shortfall. * Deed-in-lieu—Foreclosure can add accrued interest and expenses to your outstanding debt. Asa last resort, you may avoid this by voluntarily turning over the deed for your property to your lender. The deed-in-lieu can help reduce the damage to yourcredit. Foreclosure and many of the workout options listed above may have an impact on your tax liability. Therefore, be sure to speak to a tax adviser or attorney about your particular situation before proceeding. Getting Back On The Road If you’re in trouble, you're not alone. Moving quickly to take advantage of all the available assistance options can improve your chances of staying on the road and moving in the right direction. For more information, you may contact NeighborWorks at (888) 955-HOPE (4673) or go online to www.homesafepmi.com.
