Another player in foreclosure prevention.

Now comes another idea for helping people threatened with foreclosure, from the Federal Deposit Insurance Corporation (FDIC), the government company that insures your bank deposits.The basic idea of the FDIC program is that they will loan you up to 20% of the principal of your outstanding mortgage, allowing you to pay down that principle and reduce your monthly payment because (we assume) the FDIC will charge you a lot less interest on the 20% than your current mortgage holder.

I do not know how well this will work. It all depends on the terms. But add it to the list of foreclosure programs we have talked about in these blog entries, some of which are still being negotiated between Congress and the administration. There are also things going on in the various states, which you should check into. Massachusetts for example, has just started a new 90-day period between notification and foreclosure.

There is just one “rule” that applies to nearly everyone who is having a problem meeting their mortgage obligations: Start talking to your lender about options. This may not be easy. You will usually end up in “press number..” hell, but it is worth trying. Use registered letters. Email. Phone calls. Get someone with authority on the phone and ask them about options.

There is also help at many state agencies and organizations, and one national non profit: Homeownership Preservation Foundation, (“HPF”). HPF’s counseling service is available to any consumer who is facing a possible foreclosure of their home mortgage.
Founded in 2004, HPF was founded specifically to help Americans avoid foreclosure. HPF operates a national help line that offers homeowners personalized assistance. This line is open 24 hours a day, 7 days a week. Dial 888-995-HOPE (4673) or you can reach them on the Internet at www.995hope.org.

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