CitiMortgage rolled out a new program for delinquent homeowners and homeowners who are in foreclosure in Florida. CitiMortgage says:
"Give us the keys and we will let you stay for six months for free."
Before you jump on this so called deal here are some facts about Florida Foreclosures followed by our Real estate agent take on this.
Is there really an advantage to you, the homeowner in this offer from CitiMortgage? According to most attorneys we have spoken with, their answer is not really.
Once you are served a summons and complaint which would be in this instance CitiMortgage filing a law suit complaint against you as the homeowner- you have 20 days in which to respond to the complaint. If you hire an attorney or go to the legal aid society if you can not afford an attorney- they will file a defense or a counter complaint in court.
At that point, there will have to be a hearing scheduled. Most of the time here in the state of Florida- you will be able to have your foreclosure postponed for much longer than 6 months.
We know people who have not made a mortgage payment in over 24 months and are still living in their homes.
Take that in consideration before jumping on CitiMortgage's offer. They make it sound very good but they are not in business to protect you or to help you. They are in the business to cut their losses and what is in the best interest of their company and their shareholders, although the latter is questionable at best.
Turning in your keys is called a "Deed In Lieu of Foreclosure".
Remember too, there are rules that must be adhered to even in Deed In Lieu and unless CitiMortgage is also going to change the rules you may not even qualify for the Turn in the Keys program.
If you have a second loan on your property or a HELOC on your property, your second lender has to be taken care of before a Deed in Lieu can be processed. If you don't have the money to pay your mortgage payment you most likely don't have money to pay your second note off either.
Also, if you do a Deed in Lieu- the mark on your credit report is the same as a foreclosure.
A Deed in Lieu is nothing more than giving up your rights to a judicial foreclosure. It is a foreclosure without going to court.
There is most often a much better way to deal with your foreclosure filing and that is to do a SHORT SALE.
First, let me say to CitiMortgage that we as agents have had a solution to your foreclosure problem for years now and it is called a SHORT SALE!
All you have to do is relieve the homeowners of a deficiency and release the lien and give clear title to a new purchaser thereby circumventing you having to own yet another property.
Why can you not give the same deal to a SHORT SALE as you are offering to a DEED IN LIEU?
Therein lies the mystery.
This gets us to thinking, why is it that you want to own all these properties? Is there something you are not telling us?
There are qualified short sale Realtors® in the state of Florida who are ready to help you solve the foreclosure problem you are complaining about.
CitiMortgage's CEO of CitiMortgage- Sanjiv Das says: "We're committed to finding every solution possible to help families facing foreclosure. Not every homeowner has the financial stability to remain in their home." No S&%# Sherlock!
THEN CITIMORTGAGE: Embrace the SHORT SALE! It will save your shareholders money. You won't have to keep holding on to Phantom Inventory. You won't have to be a landlord. It will help home values. It will stabilize neighborhoods. It will help the economy. But then again, is there something here that we don't see?
In Florida CitiMortgage has over 12 % of their loans in a 90 days or more delinquent status. Nationwide that number is 6%. 42% of all the loan modifications that CitiMortgage approved in Florida are now 60 days one year after their loan modification was approved.
We will go into further detail about the follies and idiocies of the loan modification programs and how those are set up for failure from the onset.
This post does NOT constitute legal advise. You should seek the legal advice of a qualified attorney who works in the foreclosure field. We are not attorneys and we don't play them on TV either. This post is informational only.
Avoid Foreclosure! Call Nestor and Katerina Gasset for Short Sale Information Today- 561-753-0135 or learn more at Short-Sales-Florida.com.
To view Florida Short Sales- Click here. We know Palm Beach County Short Sales and Port St Lucie Florida Short Sales and will help you get your home Sold if you need to Sell your home and help you buy your home in Palm Beach County Florida: Call us today.
Copyright © 2010 By Katerina Gasset, All Rights Reserved.*CitiMortgage Rolls Out A New Program For Delinquent Homeowners- Give Us The Keys...*
Nestor Gasset and Katerina Gasset- Realtors®, CIPS, ABR, SFR, GRI, REOS
Nestor,
Well many home owners will benefit from it, it seems good news for many people who are in distressed situation and they don't have more options, thanks for sharing this info.
Hm, I heard recently that lenders did not want Deeds in lieu of Foreclosure, and that had something to do with liabilities, and there was something new, I think, called No Contest something, whihc was similar to Dee in Lieu.
It really changes ecery day
Very Interesting,
I just don't understand why what the banks do does not make any since.
Thank you for sharing an informative and helpful blog.
John
Ray- I don't see it that way. I see it as benefiting the banks once again. Homeowners are much better off doing a short sale or a bankruptcy. A deed in lieu is no different than a foreclosure except that in a foreclosure here in Florida the homeowner is likely going to stay in their home for more than 24 months before they ever get foreclosed on. We have 2 problem short sale listings, where the BPO keeps coming in wrong, and the owners are still living there and have not made a payment in over 2 years. The banks don't want their condos back or homes in blighted areas. Katerina
Jon- This one is specific to CitiMortgage. If they would only streamline their short sale department they could save their shareholders some of these heavy losses they are taking when they foreclose.. NOt many people around here have just one loan on their property either- the second wants what the homeowner does not want to give or has to give- so no deed in lieu in most cases. Again, I think they spit out this stuff to make it appear they are really concerned about homeowners, which they are not.
By taking this tack, the lender is trying to cut their losses. They must know that a short sale home has a lower market value than an REO. They must know their holding costs would be less than with a finished foreclosure.
All they have to do to obtain this favorable situation is convince a homeowner to do something that is not in his/her interest.
They ought to be able to make that business model work...after all the lenders are expert in doing things inimical to their own best interest.
Agreed. This will be bad for many down the road. And with a second- no deed in lieu.
We're from the government mortgage company and we're here to help.
Awesome information and easy to digest. So many times, I hear homeowners who want to take the easy way out instead of preparing the house for sale ... Does Citibank address the issue of the deficiency? Is it also forgiven just like the short sale?
Good morning,
I love Lenn's comment..how true is that?? Thanks for the informative post!
100% agreement
Kat,
I've found the same thing over here in Broward....the sheriff isn't so quick to come and change the locks. I had a short sale owner who answered the summary judgment by an attorney. At that time most extensions were about 60 days max. The short sale took 18 months to close with our favorite bank who shall be nameless. The owner had absolutely no correspondence with the bank for almost two years. They weren't living there but could have. The only thing that came up at the end was the home owners associations attorney suing my client for a few thousand but it was the attorney fees only that were collected. I don't think these so called deals are any advantage on most people...it's just another ploy by the lenders.
I have another where the client never even answered the judge and has been living there for 3 yrs.
Katerina, this is excellent information for homeowners. So much so, I'm going to re-blog it. Thanks.
Ha, ha, ha. I can believe it. What a great deal for CitiMortgage. They get the keys and title to the property PLUS they don't have to think about it for at least 6 months because somebody else is taking care of the home and paying the utilities. So the seller's credit gets trashed. Who cares? Not CitiMortgage.
I hadn't heared of this one yet., You are right in that it isn't necessarily the great deal that it first appears to be!
Tammie- ??? Sorry, but I certainly don't agree- not for Florida Homeowners! CitiMortgage is getting away with foreclosures without the judicial process. We are very protective over our judicial process as homeowners in the state of Florida. People are living in their homes for 2 and 3 years without making a single payment. And if you live in a condo- it is unlikely you would ever get foreclosed on here! The banks don't want to pay all those assessments and back fees, etc. The deed in lieu is all for the bank and nothing for the homeowner. 6 months is nothing compared to trashed credit for a foreclosure-
Our issue is that they can do short sales all day long and not have a foreclosure on their credit or in their life.
Okay...I wonder if this will make it's way out West here to California
Sounds like a win win situation in most case. They get some control but the occupant has a knowing of how long they will be there.
Chuck- Here in Florida it is a lot different than most states. We have a judicial foreclosure process in which at this point in time, homeowners can actually be in their homes for 2 to 3 years- I know when I do the math- 24 to 36 months compared to a set 6 months- that is a no brainer:) I don't know any homeowners here that would like to take a 6 month option when an attorney for a very small fee can get them years!
Not only that- the short sale is the only option that makes sense for the homeowner in most cases. What I don't like is that a deed in lieu is the same as a foreclosure and the banks pretend this is some favor for the homeowner but all it is, is a non judicial foreclosure. Here in Florida, with our homeowner homestead rights- that is hardly ever a proposal an attorney would recommend. Katerina
Ray- I don't know because California is a non judicial state and you have trust deeds there wherein the banks never have to use a judicial process to vacate homeowners. We are a deed state. Big difference: )
Katerina,
Before any homeowner accepts this program they should run it by their real estate attorney. Yes indeed, mortgage lenders do look after they own interests first.
Esko- I must add, it needs to be an attorney that you pay to give you advice and actually looks at their situation.
We just had a homeowner call us about doing a short sale who an attorney told them to just let the house get foreclosed. He said the lender is never going to come after you because they are too swamped with foreclosures so after it forecloses, they don't even need to worry about the 1099 or the deficiency! WHAT??? We now know of at least 3 attorneys who are under suspension for loan modification fraud. It moves across all professions. Very sad, when you don't even know if your attorney is advising you with your best interests in mind. Katerina