If you’re facing foreclosure, your foreclosure counselor will be a key part of your
foreclosure team. As you start looking for one, however, you need to know what exactly they do, what they don’t do, and how to choose one who’s legitimate and qualified.What a foreclosure counselor does
Reviews your finances
Helps you establish a budget
Explains your non-foreclosure options, such as
loan modification, short sale or deed in lieu of foreclosure; helps you navigate the process with any chosen optionAdvocates on your behalf with lenders and loan servicers
Counselors should also be upfront about discussing their own track records as well as the track records of the agency they work for.
Expect to spend two to 24 hours with a counselor, depending on the complexity of your foreclosure situation, including how many lenders you have to provide documentation to and negotiate with.
“Be sure the counselor is looking at your entire situation,” and not just your foreclosure, adds Martha Viramontes, director of housing at ClearPoint Credit Counseling Solutions in Los Angeles. “When counselors focus only on your mortgage, they’re fixing only one aspect of your financial situation.” They should give you an action plan containing the tasks you are going to perform to change your financial situation.
What a foreclosure counselor doesn’t do
Give tax advice
Give legal advice
Give guarantees regarding a particular outcome
Create miracles
For additional advice, add a
tax adviser and attorney to your team.Finally, “don’t expect a counselor to be a genie,” says Douglas Robinson, a spokesperson for NeighborWorks America, a nonprofit community development corporation in Washington, D.C., that provides foreclosure counseling. “If you’re in a home that under the most aggressive scenario you can’t afford, but maybe you got into it because of some toxic loan that should never have been available in the first place, you’re probably going to have to move. It’s best you get out smoothly.”
How to choose an agency
Seek only HUD-approved agencies. HUD makes it easy:
Type in your state or ZIP code at
HUD-approved agencies also are required to:
Employ counselors who are knowledgeable about federal housing programs
Have a staff of counselors of which at least half must have two or more years of counseling experience. At least half must also have received housing counseling training in the past two years
Provide you with certain documents, such as a privacy agreement explaining how your personal information will be handled
In addition, at the agency you work with, see if you can find a foreclosure counselor who has certification through the NeighborWorks Center for Homeownership Education and Counseling Look (NCHEC), which has a Foreclosure Intervention and Default Certification Program. Certified counselors must follow NeighborWorks counseling standards and code of ethics and conduct. They also are required to:
Have at least one year of experience in foreclosure counseling
Attend three foreclosure prevention courses
G.M. Filisko is an attorney and award-winning writer who has seen the sad effects of foreclosure on friends and neighbors. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.
Forclosure info courtesy of Al Matlock - Need to sell or by contact Al at dcrealtor@live.com
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