BoA, Wells, JP Morgan and other banking institution are happy to see signs of mortgage default improvements in the early months of of 2012.

So you decide Foreclosures is the right thing for you, what now? I like to provide homeowners facing foreclosure some common sense ideas on the things that can or might help them during the foreclosure process.

So okay, you told yourself and family you're foreclosing and will stop making payment on your $2500 mortgage home. Well what can you do with that extra $2500 you'll have every month? For starters, Don't spent it, treat it like you're still making that $2500 payment, get another bank account and put that money there for savings and perhaps a downpayment towards a less expensive home in the future (bank would usually lend 3 years after you foreclosed or 2 years after bankruptcy $2500*6 months is $15,000 in savings or $30,000 in a year)

Most foreclosures that go to auction get postponed, usually due to bankruptcy, meaning if the property you're leaving in now is going to be auction off in court in a few weeks or days, finding a BK lawyer/Attorney and filling for BK 13 or 7 would help you stay at home for perhaps several more months maybe years.

Keep your spirit/Morale up, don't get yourself down, remember a house is just a house – Your family is more important than that house! So smile and look towards the future.

Lastly if you need to blame someone, blame your politicians, our government, they are the ones supposed to protect you from greedy banks, but instead they bailed out the rich and screwed the working class yet again.

If you're seriously thinking about purchasing your next home or just simply looking for investment properties to rent out, homes in foreclosures can provide the best opportunity to buy discounted real estate in any state. Let me explain to you what you need to do to help you prepare to buy that real estate property.

1. Visit a mortgage specialist from the banks or a broker and first get prequalified for a loan. This is important so you'll know roughly how much you can afford and what price ranges to search for. Have a pre-qualification letter before viewings homes.

2. Start interviewing real estate agents, look for ones that specializes in foreclosure, maybe someone with experience in foreclosure auctions if you have the cash to pay for it. If you're looking for HUD, FHA or VA homes, make sure the real estate agent is certified for those government agencies.

3. Let your agent know how much you can afford, you should factor in the fix up cost and other unexpected cost)

4. View homes with your real estate agent, determine with your agent your up front costs would be, fix up cost, resale value would be for each property you're interested in. Review all available reports about properties you like, have your agent explained them to you if necessary.

5. Find out what the property would rent for, should you decide to lease/rent it out.

6. So you decide on a property, have your agent write a bid.

7. With luck, you'll get the bid in your favor. Make sure you have a thorough home inspection and appraisal done even if all reports were already provided by the selling parties (trust me on this one, you'll have less problem after getting the keys)

8. Using a reliable title company to check for any liens on the property is a must!

9. Well if all things turn out okay like title and home inspection, buy the home, move in, or rent it out or perhaps fix it up and sell it for a profit.

Ways to Prevent Foreclosure

The economy is not stable and many people are experiencing financial problems, causing many problems paying their mortgage on time. Most homeowners are concerned about foreclosure, especially during difficult economic times. Luckily, there are many ways to avoid foreclosure that many homeowners are not aware of.

Tip #1 Confront the Issue When homeowners have economic struggles their first reaction is to ignore it and hope it will go away. This never works and it will actually work against you. Talk with your lender and explain your situation. Many times there are programs available that can help you. The faster you act the more likely your bank will be to help you. Not to mention, the faster you act the easier it will be to come up with some money for at least a partial payment to keep you in good standing.

Tip #2 Call your lender Most homeowners are unaware that their lender does not want to foreclose on their home. It actually costs thousands of dollars to foreclose on a home and the average is more than $50,000! Many times loan modifications are available to help people stay in their homes. Call your bank regularly, stay in touch, and make sure your bank is working with you. If you go to court it won’t be excuse to say the bank didn’t work with you.

Tip #3 Educate Yourself It is your home and your right to own it. However, you must educate yourself on your rights as well as your state’s foreclosure laws. All states have their own laws so be sure to know yours so you can defend yourself.

Tip #4 Budget Create a budget and shave off all excess. Show your lender how you will be able to free up your budget to meet your mortgage responsibility. Doing this will show them you are serious about keeping your home and sacrificing to stay in it. For example, if you sell your second car that eliminates a payment and car insurance that could go to your mortgage. Your lender will look more favorably on you if you show you are making an effort.

Tip #5 Housing Counselor’s can help If you need help housing counselor can help you. It is best to find a HUD approved counselor who is free or charges a modest rate. Be careful of scams that prey on individuals facing foreclosure and be sure you only sign things you completely understand.

If you follow these steps you should have no problem staying in your home and getting your lender to work with you despite your financial hardship. Most people are able to overcome their financial hardships in time and if you begin working with your lender early they will more than likely be able to help you stay in your home.

It is undeniable that the mortgage world is a world of chaos lately.  All of the statistics out there are staggering, and sobering, and it is forcing more and more lenders and homeowners to look at other options.  With the number of default letters at its highest level in ten years just in the state of California, lenders have to start looking outside of the traditional methods of doing business and homeowners need to look outside the box or they’ll lose their homes.

Lenders are dealing with more delinquencies than they know what to do with and they are willing to do almost anything to avoid foreclosure.  Many lenders are being forced to accept short sales, something that is not generally done in the lending business.  When we say short sales we are referring to a situation where the balance of the loan will actually go beyond the actual value of the house.  This is done only to avoid foreclosures and until 2005 was rarely considered. 

Forecasting the Mortgage Market

Many were able to forecast that when the sub prime mortgage rates bumped up that it would cause distress and they started planning ahead, forming a specialized market of people who were able provide homeowners short sales to help to avoid foreclosure.  For many lenders, short sales are the only thing keeping them in business and many homeowners would be out in the cold without them, as well.  Many realtors have started taking on short sales to fulfill the market need and experts report that we’ll see many more years of this as there will be another reset of sub prime loans.

Today short sales are more common than ever before, but they do require more time and effort than your traditional sale.  Everyone should be ready and willing to do more paperwork, and they should also be ready for a clear cut timeline as a homeowner generally has just few months from the notice of delinquency to take advantage of a short sale opportunity.  Lenders will not offer short sales to just anyone, for instance they may extend the sale to those that have suffered the loss of a job, illness, death, divorce or change in family status, but they wouldn’t offer a short sale to someone who simply decided they didn’t want to work or someone who decided that playing poker was more important than paying the mortgage.