Freddie Mac Says Typical Foreclosure Costs 60,000 Dollars : The Real Estate Bloggers

Freddie Mac Says Typical Foreclosure Costs 60,000 Dollars

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

MoneyhousesmallIf you are one of the thousands of American’s facing foreclosure, you may have a great deal more bargaining power than you ever thought. Analysis from Freddie Mac and large banks show that their cost to foreclose on your home is in the range of 60,000 dollars on average.

The high cost of foreclosing on a loan is ample evidence that if you are having a hard time making your housing payment, talk with the lender. They have a strong incentive to work out the problems with the loan and try to find an accomodation.

Unfortunately, most borrowers do not contact their lending institution until the problem is too late. A forthright and honest approach will provide you a much better chance of saving your home and keeping the property out of foreclosure. Freddie Mac says that 68 percent of low income borrowers could be spared foreclosure if lenders created a new plan for them.

According to mortgage financier Freddie Mac, the typical foreclosure cost is nearly $60,000. And officials at HSBC North America, parent of HSBC Bank USA, HSBC Mortgage Corp. and HSBC Finance Corp., say their average loss on sale at foreclosure is 20 percent to 25 percent of the loan’s value.
“We truly believe that foreclosure is the worst alternative for all parties concerned and go to great lengths to avoid foreclosure,” Brendan McDonagh, CEO of Illinois-based HSBC Finance and former chief operating officer of HSBC Bank USA in Buffalo, said in March testimony to Congress. “Financially, it is our worst alternative.”
So like First Niagara, most lenders today have so-called “loss mitigation” departments whose sole purpose is to try to prevent a loss to the bank. But that also means doing whatever necessary, to a point, to help borrowers keep up with their payments and stay in their homes.
“Loss mitigation is working with borrowers to avoid foreclosure,” said Judith Palmer, loss mitigation manager at M&T Bank Corp. “Foreclosure isn’t good for anybody.”  via The Buffalo News

Related posts:
  1. Jumbo Mortgages For 2007 Will Remain Unchanged
  2. Mod Squad Proactively Helps EMC Mortgage Customers Facing Foreclosure
  3. Want To Save Your Home From Foreclosure? Experts Say Get Help Quickly
  4. Freddie Mac Down $480 Million in 4th Quarter, 2006
  5. Fannie Mae, Freddie Mac developing HomeStay Loan Program For Subprime Borrowers in Difficulty



Previous Post: Bert Sperling, The Man Behind Real Estates Best Places | Next Post: Buffett on Real Estate - Market is Sick



 

If you enjoyed this post, we can deliver daily content from the Real Estate Bloggers.

Subscribe using your RSS Reader

Or Get Updates Delivered Daily By E-Mail:


There Are 8 Responses So Far. »

  1. Tom - really appreciate insight like this. We have several clients in dire straits and we love to send them links to great articles like this.

  2. Great blog indeed.Mortgage refinancing adds to online mortgage services.

  3. […] Freddie Mac Says Typical Foreclosure Costs $60,000 – If you are one of the thousands of American’s facing foreclosure, you may have a great deal more bargaining power than you ever thought. Analysis from Freddie Mac and large banks show that their cost to foreclose on your home is in the range of $60,000 on average. […]

  4. […] fraudulent lenders. Actually, lenders are very interested in helping you keep your house since they stand to lose approximately $60,000 for each failed loan. Gerber does a very good job of itemizing steps you can take if you are in […]

  5. […] as much as borrowers do. With the slow moving market banks know that selling the homes they have foreclosed upon is going to be expensive and take a long […]

  6. […] industry average on completing a foreclosure is 60,000 dollars for the lender. So when the  lender has the chance to work with the borrower and they […]

  7. This is a load of crap! I am sooo depressed and aggravated right now! I got my hopes up with articles such as these that my husband, I and our 2 kids would be able to keep our first home. However, HSBC has not helped us whatsoever! I have been calling often for weeks now to no avail. I have spoken to several supervisors and noone wants to help us. They told me that there is nothing they can do and that we would need to refinance! Our loan is 210k and our house is currently worth 80k. Refinancing is not an option! Mortgage companies act on the news and articles like they are bending over backwards to help people and the fact of the matter is it is apparantly all for publicity and show because they do not care about their people!

  8. […] while the current owner tries to sell this home.  On average, it will cost a bank upwards of $60,000 to foreclose on a home - and that doesn’t even take into account the price that they may have to […]

Post a Response

« Back to text comment