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Times are not easy for Michigan homeowners, as in the rest of the U.S. thousands of homeowners are facing the possibility of losing their homes to a foreclosure. From January to May 2010 alone, there have been 74,475 foreclosure filings and 9,703 foreclosure sales in Michigan. However, there is hope for those that are willing to fight for their home. Even when a homeowner simply cannot afford their home; there are alternatives to foreclosure if you take advantage of federal and state mortgage help programs.
Michigan foreclosure law has changes in the last two years to adapt to the rise in foreclosures. For instance, since July 5, 2009, state law requires lenders to work with you (and all other troubled borrowers) to avoid a foreclosure. There are also specialized government and non-governmental mortgage aid programs that focus on providing help to Michigan troubled homeowners. These include the Department of Housing and Urban Development section for Michigan, the Michigan Foreclosure Prevention Project, the Michigan Attorney General Office and the Foreclosure Intervention and Neighborhood Stabilization Collaborative.
All of these organizations agree that when your lender starts foreclosure proceedings you must immediately contact a free housing counselor or an attorney. In some cases you might even want both.
A housing counselor will help you understand the foreclosure process in Michigan and provide you with a list of mortgage workouts available to you. They will also help you communicate with your lender and collect all the information you need to negotiate a mortgage workout with your lender. The good news is that housing counselors are free. Contact counselors federally approved by the Housing and Urban Development by calling 800-569-4287 or visit www.HUD.gov. Or visit a state approved counselor by calling 866-946-7492 or visiting www.michigan.gov/mshda. You can also contact the Michigan Foreclosure Prevention Project (http://miforeclosure.mplp.org), an organization that combines the services of legal aid offices and housing counselors throughout Michigan, as well s the Legal Services of South Central Michigan (LSSCM) and the University of Michigan Law School.
A foreclosure starts a legal process which will end in you losing your home if you don’t take steps to avoid this from happening. Foreclosure and bankruptcy attorneys have experience in dealing with debt problems, and can help you negotiate with lenders. If you cannot afford a lawyer you can find legal aid at www.michbar.org/public_resources/legalaid.cfm. They can provide you with a list of lawyers that do pro bono work (free or for reduced fees) for low income borrowers.
Contacting government and state approved agencies will protect you from so-called foreclosure prevention specialists which are often scam artists that prey on vulnerable borrowers. Remember there is no need to pay for a housing counselor, help is available for free.
Finding a housing counselor and an attorney is only the beginning, to avoid foreclosure you are going to have to contact your lender and negotiate a mortgage workout. Our next article Avoid Foreclosure Michigan: Contact Your Lender and Negotiate will look into further steps Michigan homeowners must take to protect their homes.
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