Facing Foreclosure? What to Do Right Now

A record high 2.8 million properties were hit with foreclosure notices in 2009. That’s the bad news. The good news: About two-thirds of notices don’t result in actual foreclosures, says Doug Robinson of NeighborWorks, a nonprofit group that offers foreclosure counseling.
Many homeowners find alternatives to foreclosure by negotiating with lenders, often with the help of foreclosure counselors. If you’re facing foreclosure, call your lender right now to determine your options, which can include loan modification, forbearance, or a short sale.


Foreclosure process takes time
The entire foreclosure process can take anywhere from two to 12 months, depending on how fast your lender acts and where you live. Some states allow a nonjudicial process that’s speedier, while others require time-consuming judicial proceedings.

Once you miss at least one mortgage payment, the steps leading up to an actual foreclosure sale can include demand letters, notices of default, a recorded notice of foreclosure, publication of the debt, and the scheduling of a foreclosure auction. Even when an auction is scheduled, however, it may never occur, or it may occur but a qualified buyer doesn’t materialize.

Bottom line: Foreclosure can be a long slog, which gives you enough time to come up with an alternative. Meantime, if your goal is to salvage your home, think about keeping up with payments for homeowners insurance and property taxes. Otherwise, you could compound your problems by getting hit with an uncovered casualty loss or liability suit, or tax liens.

Read the fine print
Start by reviewing all correspondence you’ve received from your lender. The letters—and phone calls—probably began once you were 30 days past due. Also review your mortgage documents, which should outline what steps your lender can take. For instance, is there a “power of sale” clause that authorizes the sale of your home to pay off a mortgage after you miss payments?

Determine the specific foreclosure laws for your state. What’s the timeline? Do you have “right of redemption,” essentially a grace period in which you can reverse a foreclosure? Are deficiency judgments that hold you responsible for the difference between what your home sells for and your loan’s outstanding balance allowed? Get answers.

Pick up the phone
Don’t give up because you missed a mortgage payment or two and received a notice of default. Foreclosure isn’t a foregone conclusion, but it’s heading in that direction if you don’t call your lender. Dial the number on your mortgage statement, and ask for the Loss Mitigation Department. You might stay on hold for a while, but don’t hang up. Once you do get someone on the line, take notes and record names.

The next call should be to a foreclosure avoidance counselor approved by the U.S. Department of Housing and Urban Development. One of these counselors can, free of charge, explain your state’s foreclosure laws, discuss alternatives to foreclosure, help you organize financial documents, and even represent you in negotiations with your lender. Be wary of unsolicited offers of help, since foreclosure rescue scams are common.

Be sure to let your lender know that you’re working with a counselor. Not only does it demonstrate your resolve, but according to NeighborWorks, homeowners who receive foreclosure counseling are 1.6 times more likely to avoid losing their homes than those who don’t. Homeowners who receive loan modifications with the help of a counselor also reduce monthly mortgage payments by $454 more than homeowners who receive a modification without the aid of a counselor.

Lender alternatives to foreclosure
Hope Now, an alliance of mortgage companies and housing counselors, can aid homeowners facing foreclosure. A self-assessment tool will give you an idea whether you might be eligible for help from your lender, and there are direct links to HUD-approved counseling agencies and lenders’ foreclosure-prevention programs.

There are alternatives to foreclosure that your lender might accept. The most attractive option that’ll allow you to keep your home is a loan modification that reduces your monthly payment. A modification can entail lowering the interest rate, changing a loan from an adjustable rate to a fixed rate, extending the term of a loan, or eliminating past-due balances. Another option, forbearance, can temporarily suspend payments, though the amount will likely be tacked on to the end of the loan.

If you’re unable to make even reduced payments, and assuming a conventional sale isn’t possible, then it may be best to turn your home over to your lender before a foreclosure is completed. A completed foreclosure can decimate a credit score, which will make it hard not only to purchase another home someday, but also to rent a home in the immediate future.

Your lender can approve a short sale, in which the proceeds are less than what’s still owed on your mortgage. A deed-in-lieu of foreclosure, which amounts to handing over your keys to your lender, is another possibility. The earlier you begin talks with your lender, the more likelihood of success.

Explore government programs
The federal government’s Making Home Affordable program offers two options: loan modification and refinancing. A self-assessment will indicate which option might be right for you, but you need to apply for the program through your lender. A Making Home Affordable loan modification requires a three-month trial period before it can become permanent.

Fannie Mae and Freddie Mac have their own foreclosure-prevention programs as well. Check to determine if either Fannie or Freddie owns your mortgage. Present this information to your lender and your counselor. Fannie and Freddie also have rental programs under which former owners can remain in recently foreclosed homes on a month-to-month basis.

The federal Home Affordable Foreclosure Alternatives program, which takes full effect in April 2010, offers lenders financial incentives to approve short sales and deeds-in-lieu of foreclosure. It also provides $3,000 in relocation assistance to borrowers. Again, talk to your lender and counselor

See Foreclosure homes in Metro Atlanta: http://bit.ly/TodaysForeclosures

12 Tips for Saving Energy in your Home Office

With roughly 34 million telecommuting adults in America—a number slated to double by 2016, according to Forrester Research—adjustments to your home office power consumption, lighting, and heating and cooling can impact the environment and your wallet—up to about $200 per year in energy costs.

Down-shift your power consumption
1. Activate power-management settings.
Home office electronics have multiple power modes: active (or “on”), active standby (“on” but consuming less than 100% power), and passive standby (or “off”), according to the nonprofit American Council for an Energy Efficient Economy, which promotes energy efficiency to consumers and government policy makers.

You can instruct your computer to move into lower-consumption modes automatically when you’ve stopped using it temporarily—during a lunch hour or phone call, for instance—yet also wake up when you’re ready to resume working. Such tactics can reduce your computer-related electricity costs by $25 to $75 per machine annually, says Energy Star.

Energy Star-rated power management features are available on Macintosh and Windows platforms (XP, Vista, 2000). Energy Star offers tips for how to adjust settings on different platforms.

Other providers offer help, too: Software vendor Verdiem offers a power management set-up tool called Edison and EnergyStar offers a similar tool called EZ Wizard, both of which guide you through the process of setting up power management.

If you’re uneasy launching power management protocols yourself, you can pay software companies’ IT pros to log on to your computer remotely and adjust your settings. Symantec, for instance, charges about $20 for its “Green PC” service.

2. Use a power strip for your computer, printer, copier, and other peripherals.
If you plug office electronics into a power strip, you can switch all of them fully off (versus leaving them in “standby” mode) with one button. Power strips cost around $3 to $12 from online retailers. Standby power—the energy that’s wasted by electronic devices that are plugged in, but not in use—represents about $100 per year in the average household’s electricity costs, says Energy Star. Assuming your home office equipment represents about 4% of your electricity bill, you could save up to $4 a year.

3. Be Energy Minded when you buy.
If you’re investing in new computer equipment, look for Energy Star-rated computers, small servers, copiers, fax machines, and adapters. Energy Star estimates that using these rated electronics in your home office can save $115 over the products’ lifetimes.

4. Consider a laptop over a desktop. Laptops use one-third the power (22 watts) of a typical desktop (68 watts) when in active mode, according to ACEEE. Annually, a laptop could save you about $19 compared with a desktop.

5. Opt for a flat-panel vs. CRT monitor. A cathode-ray tube monitor consumes about 70 watts of power, while an LCD or flat-panel eats only 27, according to ACEEE data. That’s about $1 in savings over year.

Reduce lighting costs
6. Replace traditional bulbs with compact fluorescents. By replacing one 60-watt incandescent bulb with an equivalent compact fluorescent in a home office where lights are on for eight hours per day, you could save up to $15 per year, according to Energy Star.

7. Buy CFL versions of halogen lights. If you like the look or brightness of halogen or torchiere lamps, the The Edison Electric Institute recommends buying compact fluorescent versions that consume less than 25% of the power (55 to 65 watts) of conventional versions (300 watts) and cost about the same.

8. Consider task lighting. Opting for a desk lamp versus whole-room lighting lets you use fewer bulbs concurrently, according to The Institute.

9. Locate lamps in corners. The adjoining walls will magnify the light across the room.

10. Turn off lights when leaving a room.

Keep heating and cooling costs at bay
11. Lower thermostats 10% during the day (to 62, for instance, from 68). This can save up to 10% on annual heating and cooling bills, according to the DOE, or about $100 per year. Supplement with thick slippers and sweaters in winter and keep windows open in summer, with shades down in the afternoon.

12. Use a space heater in winter and a portable or ceiling fan in summer. Both room-specific solutions cost far less than running whole-house systems at maximum capacity. Using fans or space heaters will eat into your savings for lowering the thermostat, but not nearly as much as using a central heating or cooling system throughout the house. Fans can run $25-$150; space heaters, $10-$80 at online retailers.

If your office is one-third the size of your house or smaller, you can safely estimate that space heating will be more cost-effective than heating the entire home just for the sake of the office, according to NYSEG, a utility company in Rochester, N.Y.

Optimizing your home office for maximum energy efficiency requires little effort, but can help lower your home’s overall energy consumption and annual utility bill without hampering productivity.

To see all the homes with home offices that are available in the Atlanta area go to: http://www.anzianorealestate.com/

Save Energy in the Family Room

Reduce your electricity bills by systematically purging your family room of wasteful energy practices.

The fun—a video game console, TV, DVR, DVD, and stereo system—that your family room provides comes with a price. By reducing standby power, using rechargeable batteries in remotes, and replacing incandescent bulbs with compact fluorescents, you could save up to $130 a year in energy costs.

And if you’re in the market for a new TV, you can save even more energy by being flexible on the type you buy.

1. Reconsider that plasma TV. The three biggest energy hogs in the family room are the plasma television, DVR/Tivo box, and digital cable box, says the nonprofit American Council for an Energy Efficient Economy, which promotes energy efficiency to consumers and government policymakers.

A typical plasma TV (less than 40 inches) consumes 441 kilowatt hours of electricity per year, according to ACEEE. That translates into about $50 (based on 11.3 cents per kilowatt hour). Next up are TiVo devices at $41 annually, followed by digital cable boxes at $27. Both devices are always fully on because they constantly receive and download data.

Opting for an LCD (liquid crystal display) TV will cost about $8 to operate annually—for an annual savings of about $42 over the plasma. Of course, weigh your decision against the cost of a new TV.

2. Reduce standby power. Vampire power—the energy that’s wasted by electronic devices that are plugged in, but not in use—represents about $100 per year in the average household’s electricity costs, says Energy Star. Assuming the family room represents about 15% of your electricity bill, you could save about $15 per year with smart standby practices.

Unplug rarely used electronics (like that karaoke machine) altogether and cluster other appliances, even adapters for cell phones and digital cameras, onto power strips ($3-$12 for a six-outlet strip). Then you can fully turn off all attached electronics with one switch.

Unfortunately, some family room electronics, such as set-top boxes and downloading devices like TiVo, can’t be turned off, because that would disrupt the digital data-gathering you’ve programmed them to do. But with a so-called smart power strip (about $20 to $40 through online retailers), you can completely turn off your TV while leaving the always-on DVR plugged in.

3. Opt for Energy Star-rated electronics. They’re anywhere from 6% (audio products) to 75% (DVD players) more efficient than non-rated electronics. Take Energy Star-rated television sets. They use about one-third less energy than their nonrated counterparts.

If you can’t live without plasma, consider an Energy Star model for which you’ll pay $18 less per year in operating costs than for a nonrated one. If you use an Energy Star-rated digital cable box (ask your provider if any are available for no charge), you could pay 30% less for energy—an annual savings of about $8.50. Energy Star hasn’t yet published data on swapping out a DVR or Tivo device.

4. Invest in rechargeable batteries. No, they won’t help you save on your electric bill. But you’ll save on the cost of batteries for your video game system and other entertainment remotes, according to PJ Stafford, founder of Green Irene, an eco-consulting company that provides energy and environmental makeovers to homeowners. You’ll help the environment, too. For every rechargeable battery you buy, you prevent at least 500 single-use batteries from entering the waste stream, Stafford says.

Consider a game system charger station, which runs about $25, or outfit your media room with 10 rechargeable batteries and two chargers for $55 to $65. (Rechargeable AA and AAA batteries cost $3 to 3.50 apiece, versus 75 cents to $1 for disposables; a charger costs $25 to $30.) That investment in rechargeable batteries and chargers, in lieu of 500 batteries over four years, adds up to about $310 to $445 in savings. Buying a charging system for your video game system eliminates the need to buy batteries for the controllers.

Call your local trash collection service to find out which batteries can be recycled or taken to a transfer station versus being thrown away. If you’re doing a major sweep-out of old batteries and appliances, consider Big Green Box, which lets you send your devices and batteries to a sustainable processing facility. Recycle old rechargeable batteries for free via programs like Call 2 Recycle.

5. Replace bulbs with compact fluorescents. By replacing one 60-watt incandescent bulb with the equivalent compact fluorescent in a family room where lights are on for four hours per day, you could save $7 per year. CFLs cost between $2 and $15.

See all the energy efficient homes in Metro Atlanta.

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