Posted On: December 23, 2012

A Home For the Holidays: Lenders Temporarily Suspend Foreclosures

Some of the country's largest lenders, along with Fannie Mae and Freddie Mac, have announced they will be halting a number of foreclosure proceedings during the holidays. giftforyou.jpg

As our Birmingham foreclosure lawyers understand it, the time-out starts Dec. 19, 2012 and will continue through Jan. 2, 2013 for Fannie and Dec. 17, 2012 through Jan. 2, 2013 for Freddie.

Representatives from both entities said they will put a temporary stop on all evictions of homeowners who are in single-family properties or in apartments that have up to four units and whose mortgages are financed by a government-sponsored enterprise.

Additionally, Citigroup and JPMorgan Chase announced they also intend to halt foreclosures temporarily. JPMorgan said its grace period will run Dec. 19 through Jan. 1. Citigroup hasn't given a timeline for its plan.

While this is good news, particularly for those who are on the brink of being forced out of their homes, the respite will be brief. In fact, firms that handle evictions for these entities are going to continue filing foreclosure paperwork so that evictions can proceed as usual just after the new year.

This means that those who are facing foreclosure certainly shouldn't take this as an opportunity not to act. If you contact us soon enough, our Birmingham foreclosure attorneys may be able to use this this time to your advantage.

The news is especially relevant here in Alabama, where foreclosure sales shot up 33 percent in the third quarter of this year, compared to the second quarter. Such properties sell for about a third less than what they would normally, and what's more, they force people to leave beloved homes.

According to RealtyTrac, there were nearly 1,000 foreclosures in the state during that quarter, which represents a sharp 12 percent rise from the same time last year.

In all, foreclosures in Alabama account for about 16 percent of all home sales. Throughout the country, it stands at 20 percent. In Georgia, which saw the highest foreclosure rate of any state, foreclosures accounted for nearly 40 percent of all home sales.

In a healthy market, we would be seeing this figure be closer to about 5 percent, so we can see that we still have a ways to go in terms of recovery.

Foreclosed properties in Alabama on average sold for about $105,000, which is about 30 percent less than their market value.

What's important to understand is that you are not helpless to fight back against foreclosure, even if you are significantly behind on your payments. Contacting an experienced foreclosure attorney is your first step.

From there, we can discuss requesting an extension from the court in order to buy several more weeks in order to carefully explore your options, so you won't feel rushed into anything.

Given the fall-out of the housing market collapse, there are many viable defenses to foreclosure, based primarily on lenders' failures. These defenses include:

--Predatory lending;
--Breach of contract;
--Truth-in-Lending Act;
--Home Ownership and Equity Protection Act;
--Failure to comply with pre-foreclosure conditions;
--Failure to verify assets or income;

You may also want to consider a Chapter 13 bankruptcy, which will allow you to reorganize your finances and make smaller payments to catch up on your debt obligations.

To determine what is the best course of action for you, don't wait until the holiday grace period is over. Call us today.

If you need to speak to an Alabama foreclosure attorney, contact Eversole Law at 866-831-5292.

Additional Resources:
Sales of foreclosure properties in Alabama rise 33 percent amid hefty discounts, Dec. 10, 2012, By Dawn Kent, Alabama Live

Fannie, Freddie halt foreclosures for the holidays, Dec. 3, 2012, By Alain Sherter, Jason Henry McCormick, Money Watch

More Blog Entries:
Despite Annually Fewer Filings, Bankruptcies Still at Record High, Sept. 14, 2012, Birmingham Foreclosure Lawyer Blog