Sacramento Pre-foreclosure Workshop December 8, 2009, Gives Homeowners Education, Options, Timelines, and Strategies to Fight Back

As our country hemorrhages from a foreclosure crisis of historic proportions, home values plummeting, layoffs the rule instead of the exception and millions of families having lost their homes and millions more just a couple missed payments away from being homeless, one commonsense solution to the foreclosure crisis stands out. That solution is simple, modify loan terms.

As simple a solution as this might seem, the reasons for the stagnation of action created by the complexity of the monetary forces behind our crisis are not so simple. At one time in our history those that owned the loan also underwrote the risk, collected payments, and adjusted the payments as a borrower’s circumstances changed. It was a time when lenders actually made money when a loan was performing in their portfolio and not selling it on the secondary market as quickly as possible. This frenzy to turn over loans in inventory was like “nitro fuel” that “souped up” the engines of securitization (thousands of loans pooled together) in this country and at the same time fed the hunger for bigger and faster investment returns on a global scale. The result was, the once held notion that there was transparency of ownership became “A thing of the past”.

The By-Product of securitization was the rise of the Mortgage Servicing Industry. According to the Mortgage Market Statistical Annual, the securitization rate of mortgages increased from 56.6% in 1990 to 79.3% measured to 2008. This 3^rd party element between the borrower and the entity who actually owns the loan (the investor) is creating problems of epic proportions as we try to solve and get past this crisis in our country. These Servicers hide behind the fact that they do not own the loan and even pretend that they have little or no control over the decisions to modify these loans. This in fact could not be further from the truth.

What is not understood by most is, these large pools of securitized mortgages that are governed by an interlocking set of complex tax and accounting rules repeated in the trusts’ governing documents are not usually prohibited from modifying borrower’s loans. Even though some of these rules restrict the circumstances in which a loan can be modified or create disincentives for loan modifications, the actual owner of the loans have very little say in the decisions to modify a borrower’s mortgage loan. The reality is the Servicer is usually incentivized monetarily to let the home go into foreclosure than to modify the loan.

The Sacramento Pre-foreclosure Workshop was born from the need to empower borrower’s with the education, options, timelines and strategies necessary to combat the Servicers and lending industry. The next Sacramento Pre-foreclosure Workshop will be December 8, 2009 at the Best Western Expo Inn on Howe Avenue. The event will start promptly at 6:30pm. Registration for the event can be accomplished by going to www.SacramentoPreforeclosureWorkshop.com.

The Nuestart Family is a team of boutique financial companies synergistically interconnected for the purpose of teaching and providing to their clients the unique concept of Total Asset Optimization. Luca Financial Services, Luca Insurance Services, NueStart Financial Services, Williams Landmark Real Estate and NFS Commercial provide the ability for the clients simultaneously optimize all of their financial assets.

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If you would like more information on this topic or would like to schedule an interview with Leon Williams, please call 916-487-6400 or email leon@lucafinancial.com.