Eleventh hour negotiations helping to solve some foreclosures

stop-foreclosure-now

Eleventh hour negotiations are helping to solve some foreclosures in Louisville Kentucky. Peter and Gina Fochtman looked grim as they sat in court facing a man who seemed to be holding the keys to the future of their family. The person was an attorney representing the bank ready to foreclose upon their house.

Some months ago the couple lagged behind in mortgage payments. Since then they had tried many times to contact the lender so as to sort through piles of never ending paper work. But just as the house was about to slip through their fingers the couple got help from a programme initiated by the city that had made it mandatory for the lender to meet the borrower as a final step to be taken before taking the decision to foreclose.Peter Fochtman referred to the situation as a nightmare from the start. A salesman by profession Peter blames his financial trouble to increasing medical expenses in treating the heart condition of his child. His wife works as a part time clerk.

The mandatory clause by Louisville about lenders meeting borrowers has helped to stave off many foreclosures, allowing families to stay in the houses that were their homes. Similar steps have been taken in Connecticut, Philadelphia and Nevada. It is part of big steps taken by the administration to stem the tide of foreclosures.

Over 1.5 million American families had faced the risk of losing their homes to foreclosure during the first half of the current year according to RealtyTrac. From the start of 2007 over 1.6 million borrowers have surrendered their houses to the lenders. Currently a staggering 12% of the American residential house owners having a mortgage are either lagging behind in payments or are already in foreclosure. Within the next twelve months this number is expected to go up because of the increasing unemployment scenario.

In the regions where this stipulation is in force the attorneys of the lenders have to attend the meeting sessions if the homeowners want it. But that does not mean that the banks are bound to modify loans.

The measure however turned out to be a breather for the Fochtmans who were hard expressed by their four children repeatedly asking them how long they would continue to stay in their home.

The programme has been operating since 1st July and so far 30 conciliation sessions have been held. It is hoped the number will increase. The Fochtmans got free help from Legal Aid Society.