Providing Hope for Homeowners
CDCU Success Story, February 2011
Carlos and Maria Ambriz never anticipated that foreclosure could happen to them. But like so many others lately, they found themselves fighting to save their home. Carlos was working hard trying to keep his construction business going, while his wife Maria was very busy at home with their three children. Unfortunately, Carlos began seeing a steady decrease in business directly associated with the economic downturn, and knew he would soon have trouble making the mortgage payment. He contacted his lender and explained his situation and asked if they could do anything to help. He was told that nothing could be done until the payments were behind. With little savings to rely on, it wasn’t long before Carlos was no longer able to afford to keep his business going or keep up with the mortgage payments.
Faced with this dilemma, Carlos and Maria knew they would have to make some difficult decisions. Carlos realized he had to give up his construction business that he had put so much time and effort into and take a job that would provide more stability, albeit at a substantial reduction in pay. Maria, who was used to devoting the majority of her time and energy to being a busy full-time mom, realized she would have to take a job outside the home to help with the bills during this difficult time. Carlos tried unsuccessfully for nine months to work out a payment plan with his mortgage lender but was always denied. With hope quickly fading and the reality starting to sink in that they may lose their home, the Ambriz family finally caught a break. They received a flyer from their mortgage company with a number to call for foreclosure prevention assistance. That number eventually led them to Community Development Corporation of Utah (CDCU) where they were referred to Pedro Lira, a Housing Counselor for CDCU. “They were doing all they could do to save their home but needed some help putting things together and stating their case,” said Pedro.
Pedro helped them create a realistic budget to work from and also found that they had miscalculated their earnings which had put them just below the amount they needed to qualify for a loan modification. CDCU corrected the information and resubmitted a complete and accurate hardship file to the lender. “Pedro worked with our lender and we were approved for a loan modification a month later! It was such a relief to know we could keep our home and for that we are forever grateful,” said Carlos.
The late payments had to be added to the principal balance to bring the loan current. Also, to help Carlos and Maria stay current, their new payment was lowered from $1,068.14 to $922.07 and the interest rate was dropped from 5.5% to a fixed 4.5% rate. Though money is still tight and Maria has to continue working to help make ends meet, this payment reduction allows for some much needed breathing room. “They are really honest, hard-working people and I am glad they will be able to keep their home,” said Pedro.
The good news is more and more mortgage companies are referring clients to a counseling agency like CDCU and some will not even consider helping borrowers until they have been to counseling. The benefit of a housing counselor is that he or she can help a family to understand all the different types of workouts, which ones they might qualify for, and how to develop a plan to implement a workout successfully. However, there are many other options available depending on the family’s situation. An experienced housing counselor will spend time working with a family to make sure they understand the foreclosure process in Utah. This includes showing them how to avoid the many scams targeted at delinquent homeowners, how to go about catching up on their missed payments, and how to understand the implications of a short sale or foreclosure. Recent data support the need for more qualified housing counselors to help with the ongoing foreclosure crisis. According to RealtyTrac®, Utah suffers as the sixth highest state for per-capita foreclosures (http://www.realtytrac.com/foreclosure/foreclosure-rates.html). Also, recent data available from the National Bankruptcy Research Center show that Utah ranks fourth in the nation in per-capita bankruptcies, at more than 50% above the national average (
Community Development Corporation of Utah continues to see a steady flow of families in need of foreclosure mitigation assistance. In the last year alone, CDCU has counseled 552 homeowners facing foreclosure and has seen a great deal of success with those that stay with a foreclosure prevention plan provided by a CDCU housing counselor. CDCU also offers foreclosure prevention classes each month in English and Spanish to help those who may be facing foreclosure and provided this service to 174 households last year.
