Foreclosure FAQ

 

Who does the Washington Homeownership Resource Center serve?

The Washington Homeownership Resource Center (WHRC) serves residents of Washington State who have questions related to homebuyer programs, pre-purchase counseling, post-purchase counseling, or foreclosure.

 

What can a call to the WHRC do for you?

When you call the WHRC, an intake and referral specialist will ask you some questions about your situation and your mortgage.  Based on your location and the services you are looking for, the specialist will refer you to the appropriate counseling agencies, legal aid, and/or government agencies.  If you have received any foreclosure notices from your lender, the specialist will help you take action and respond appropriately.

 

What are Housing Counselors and how do they help?

The Department of Housing and Urban Development (HUD) sponsors housing counseling agencies throughout Washington State that assist homeowners for little or no charge. If you are struggling to make your mortgage payments due to a hardship or are already in foreclosure, call a housing counseling agency and ask for a foreclosure prevention counselor.  Some housing counseling agencies require that you take a class before meeting with a counselor, and all require the completion of an intake packet of your information.  Once you are assigned a counselor, he or she will work with you to present a completed packet to your mortgage servicer.  There is no need to pay a private company for these services.  If you are solicited by a company that claims to be able to modify your mortgage for an upfront fee, it may be a scam.

 

Can I work with more than one housing counselor at once? What if I’m unsatisfied with a counselor I worked with in the past?

Since HUD approved counseling agencies in Washington State are quite busy, we suggest you leave a message with more than one agency.  Once you choose an agency to work with, however, we recommend that you only work with one counselor.  If you are unsatisfied with your current housing counselor, we encourage you to communicate your concerns and have him or her close your file.  Once your file is closed, you are free to find another counselor.

 

I live in an area with no counseling agencies. What are my options?

Many of the HUD-approved housing counseling agencies serve statewide.  Counseling and the transfer of paperwork can be done online, by fax, or on the phone. We encourage you to contact a housing counselor for help.

 

How can I be sure that I’m working with a legitimate housing counseling agency?

Housing counseling agencies should not charge you for their services.  Any organization that contacts you promising to guarantee you a new mortgage, charges upfront fees, advises you to stop paying your mortgage or to stop talking to your mortgage company, and/or calls from out of state is probably too good to be true.  These companies use television and internet advertisements as well as personal solicitations targeting homeowners in default. To ensure you are working with a HUD approved counseling agency, ask your housing counselor if he or she is approved by the United States Department of Housing and Urban Development.  If you suspect a scam, you should contact the Washington Attorney General’s Office consumer protection line at 1.800.551.4636.  You can also contact the Federal Trade Commission at 1.877.382.4357.

 

 

Notices

I received a Notice of Pre-Foreclosure Options from my lender.  What does this mean and what are my options?

In Washington State, the Notice of Pre-Foreclosure Options is the first of three notices your lender is required to send you after you default on the mortgage payment.  This notice informs you of your right to an in-person meeting with your lender regarding the missed payment(s) and your future options.  You must respond to the Notice of Pre-Foreclosure Options within 30 calendar days from the date on the notice.  If you respond in time, the bank must wait 90 days from the date of the Notice of Pre-Foreclosure Options before posting a Notice of Default, which is the next required notice.  If you choose not respond, the lender can issue the Notice of Default 30 days after the date on the Notice of Pre-Foreclosure Options.

 

How do I respond to the Notice of Pre-Foreclosure Options?

We recommend that you respond to the Notice of Pre-Foreclosure Options by certified mail and keep the returned green receipt that shows the lender has received your request.  Include your loan number, the date you received the notice, and either request an in-person meeting in your county or a meeting via telephone with your lender.  Include the following sentence:  “I understand pursuant to the Foreclosure Fairness Act section (5)(f) that a person who is authorized to modify my loan obligation or reach an alternative resolution to foreclosure must be available in person or via telephone at the meeting.”  The Notice of Pre-Foreclosure Options should include an address to which you can send the response.

 

Do I need a housing counselor to respond to the Notice of Pre-Foreclosure Options and attend the meet and confer with me?

You do not need a housing counselor to respond to the Notice of Pre-Foreclosure Options on your behalf.  You may, however, have a housing counselor attend a meet and confer with you.  The meet and confer can be conducted any time after the Notice of Pre-Foreclosure Options is issued.

 

What is the difference between a Meet and Confer and Mediation? When do I request each?

After you receive a Notice of Pre-Foreclosure Options from your lender, you have the right to request a meet and confer with a representative from your mortgage holder.  This is an informal meeting between you and the lender to discuss alternatives to foreclosure.  This meeting is held in the county in which you reside.  You do not need a housing counselor or an attorney to request a meet and confer, but he or she can attend the meeting with you as an advocate.  This meeting can occur any time after the Notice of Pre-Foreclosure Options.  If you receive a Notice of Default, however, contact a housing counselor or an attorney immediately. You have the following amount of time to have a housing counselor or attorney request mediation on your behalf: from the date of the issuance of the Notice of Default until 20 days after the recording date on the Notice of Trustee Sale.  Because you cannot make the request to the Department of Commerce on your own, it is important that you contact either a housing counselor or attorney quickly.  The sooner you contact a housing counselor or attorney about your Notice of Default or Notice of Trustee Sale, the more time you have to complete the necessary paperwork required for a mediation request.

 

What typically occurs at a mediation? Who must attend?

Anyone on the Note and Deed of Trust must attend the mediation in person.  Others attending the mediation  include your housing counselor or attorney, a person with the ability to modify your mortgage, and a neutral third party mediator.  Exceptions can be made for those who need interpretive services or are physically/mentally in need of additional representation.  The session provides an opportunity to discuss alternatives to foreclosure.   Remember that the mediator does not have the authority to order a resolution, but he or she may be able to help you and your lender reach an agreement on your behalf.

Mediations typically last between one and three hours and usually occur no later than seventy days after the mediator is selected, unless otherwise agreed.  Thirty days prior to the session, the mediator will set a time, date, and place.  If no agreement is reached during the mediation but the mediator determines the lender acted in good faith, the bank can proceed with the foreclosure and record the Notice of Trustee Sale.  If you can reach an agreement with the lender, the foreclosure stops.

While you are waiting for your mediation to occur, continue providing your housing counselor or attorney with updated documents.  This includes pay stubs, utility bills, bank statements, and your mortgate statements.

 

Who in Washington State is eligible for a medation?

Only owner-occupied single family residential properties are eligible for mediation.  If your property is a duplex, triplex, four-plex, or a rental or investment property, you do not have a right to mediation under the Foreclosure Fairness Act.  Some small banks and credit unions are exempt from the mediation process.

 

How much does mediation cost?

The fee for a mediation is $400.00 dollars.  The bank pays $200.00 and you pay a $200.00 mediation fee to the neutral third-party mediator.  There is no waiver of fee payments.  Extensions or second sessions also require payment of advanced fees.  If you do not pay for your medation, you are no longer eligible.

 

How long can I stay in the home after the foreclosure sale?

If your house is sold, you must move out within 20 days after the sale or an eviction action may be filed against you.  To start an eviction action, the new owner must serve you with a summons and complaint for an unlawful detainer action.  If you are served with these legal documents, you should contact an attorney right away.

 

 

General

What is the difference between a refinance and a loan modification?

A refinance is a new mortgage with new terms, a new interest rate, and a different monthly payment.  If you have a high-interest rate mortgage, an adjustable-rate loan, or your payments are becoming unmanageable, you may want to consider refinancing your loan.  You must be approved by a lender.  You can shop around for a bank that offers the best options for you.  If you are not eligible for a traditional refinance due to lack of equity, check to see if you are eligible for the Home Affordable Refinance Program (HARP) under the Making Home Affordable Act.

A loan modification is an adjustment on the payment of your current loan for homeowners who are behind on their payments due to a hardship.  Housing counselors will work with you and your lender to present a modified payment plan to the bank.  The lender has the ultimate decision making authority on a modification.  However, a housing counselor can be a strong adocate for you in the process.

 

Where can I learn more about the programs offered under the Making Home Affordable Act?

You can learn more by going to the Making Homes Affordable website, which is maintained by the U.S. Treasury and HUD.

 

I want to transition out of the home. What are my options?

If you can’t afford your mortgage payment and it is time for you to transition to more affordable housing, you may be interested in a short sale or a deed-in-lieu of foreclosure.  In a short sale, the mortgage company lets you sell your house for an amount that falls “short” of the amount you still owe.  In a deed-in-lieu of foreclosure, the bank lets you transfer ownership back to the servicer if the home cannot be sold at market value.  Many lenders require you to list your home for 90 days prior to deeding the property back to them.

 

What is the difference between a conventional short sale or deed-in-lieu and a HAFA short sale or deed-in-lieu?

With a HAFA short sale, your servicer waives the deficiency.  This means that you are not responsible for the money you still owe on your mortgage. You also may receive relocation assistance.  You can go here to read more about the HAFA programs.

 

How do I access publically recorded documents related to my mortgage?

You can access deeds, mortgage documents, liens, notices, subdivision, and real estate contracts at the county recorder’s office.  Depending on the county and the document, you may be able to find them online.

 

How can I check to see if Fannie Mae or Freddie Mac owns my mortgage?

Use the following lookup tools to see if Fannie Mae or Freddie Mac owns your mortgage:
Fannie Mae Loan Look Up
Freddie Mac Loan Look Up

 

The assessed value of my property went down but my taxes went up. Why?

According to the King County Department of Assessment, your taxes are based on more than just the assessed value of your property.  Depending on where you live, the specific taxes levied in your area, and local real estate values, it’s possible that while the appraised value of your home has decreased, your taxes have increased.  That’s because about half of your property tax is determined by the levies that you and your neighbors have approved. These include services such as schools, parks, emergency medical service and fire/rescue.  If these levies stay the same or increase from the year before, your property taxes may increase as well.  Also, if other valuations decrease more than yours, your taxes may also increase.

 

Where I can file a formal complaint against my bank or financial institution?

You can file a complaint against your bank or financial institutions from the following list:

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Testimonials

I want to say a huge thank you.  It feels a million times better knowing where we will be living, that we don't have to move, and I can actually afford to live here.  My life is no longer on hold, and we have been able to make plans for the first time in ages. There is no more black cloud of uncertainty hanging over my head always, waiting for the bank to dictate so much of my life. Thank you, thank you, thank you!
C. K.
There are no words to say how much you did for us and how much you helped us, you basically saved us.
B. A.
Thank you for taking the time to talk to me and put my heart at rest! I look forward to working with you to stay in our home.  I have an appointment with a housing counselor your referred us to and I will give you an update once that occurs.  Again, it meant so very much to me that you took the time to give me hope.
A. F.