Many distressed homeowners in Las Vegas, Nevada have discovered that getting a loan modification is not easy as they were led to believe. The Obama Administration has been touting loan modification as a way to help troubled borrowers avoid REO properties for sale.
However, despite numerous efforts to help homeowners who owe more on their mortgages than the total value of their homes, there is still little to show that the government’s programs to stem the tide of foreclosures are working as intended, particularly in the city of Las Vegas.
Las Vegas has become the center point of the subprime mortgage crisis, with the number of REO properties for sale numbering seven times more than the national average. According to data, 70 percent of homeowners in Las Vegas have negative equity and about 12 percent have defaulted on their monthly mortgage installments.
Some industry experts believed that those homeowners whose mortgages are bigger than the value of their properties should just walk away from them and start all over again.
They pointed out that many homeowners made home equity a part of their retirement income, adding that they will never achieve financial freedom if they have mortgages bigger than the values of their properties.
They advise distressed homeowners to consult with certified public accountants or lawyers about possible consequences of defaulting on home mortgages, such as tax liabilities, low credit rating or deficiency judgments by banks.
Mandy Peacock of the AAA Home Rescuers believed that homeowners should learn how to make an informed decision based on benefit and costs of their options. She explained that not all homeowners should fight REO properties for sale.
She claimed that there are various ways to walk away from their properties without totally ruining their credit, adding that repossession is the worst thing that could happen to an individual’s credit history.
Meanwhile, All Western Mortgage President Chris Biaggi said that lending institutions and banks do not have any option to prevent distressed homeowners from turning their backs on their properties. He explained that even people who can afford to pay their monthly mortgage have come to realize that there is no sense to continue paying for something that is not worth to keep anymore.
On the other hand, Gary Kishner of Chase Bank said that the bank wants to help troubled homeowners avoid REO properties for sale, but everything depends on their ability to pay.
back to top
Comments on this entry are closed.