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How to Stop Foreclosure in Los Angeles, California: Options, Rights, and Available Services
Understanding Foreclosure and How it Works in California Foreclosure is a legal process initiated by lenders to recover the balance of a loan when a homeowner falls behind on mortgage payments. In California, most foreclosures are non-judicial, meaning they don’t go through the court system. This can speed up the process, so it’s essential for homeowners to understand their rights and options. If you’re facing foreclosure in Los Angeles, California, you’re not alone, and there are ways to halt the process and protect your home. In recent years, new laws have provided additional protections, including Assembly Bill 2424 (AB 2424). This bill strengthens protections for homeowners at risk of foreclosure, giving more time and options to resolve their situations. Below, we’ll cover your options, services available, your rights under new and existing laws, and how bankruptcy can serve as an alternative if needed. Understanding Your Rights and Protections with AB 2424 California homeowners now benefit from increased protections under AB 2424, a law that further reinforces California’s Homeowner Bill of Rights (HBOR). Effective as of 2024, AB 2424 offers the following key provisions: Enhanced Communication Requirements: AB 2424 requires lenders to make diligent efforts to reach and inform homeowners of their foreclosure status and available options. This includes multiple attempts at contact through various communication channels, ensuring homeowners are informed early on. Extended Cure Period: The new law extends the period during which homeowners can "cure" (or resolve) their mortgage default before the foreclosure proceeds. This gives homeowners more time to explore options like loan modifications, refinancing, or repayment plans. Mandatory Alternatives: Before initiating foreclosure, AB 2424 mandates that lenders must explore viable alternatives, including loan modifications and forbearance agreements. This makes it more difficult for lenders to proceed with foreclosure without exhausting all other possible solutions. Protection Against Dual Tracking: The dual-tracking restriction prevents lenders from pursuing foreclosure while a homeowner’s application for loan modification or other assistance is being reviewed. This protection helps prevent homeowners from facing foreclosure without a fair chance to seek alternatives. Options to Stop Foreclosure in Los Angeles If you’re facing foreclosure, there are several ways to potentially stop the process and keep your home: Loan Modification: A loan modification adjusts your loan terms to make payments more affordable. With AB 2424, lenders must prioritize loan modifications and consider them before initiating foreclosure. This could mean adjusting the interest rate, extending the loan term, or even reducing the loan principal. Repayment Plan: Some lenders may agree to a repayment plan, allowing you to catch up on missed payments by adding an extra amount to your monthly payments. This option is helpful if you’re temporarily behind but can afford to pay more each month to stay in your home. Forbearance Agreement: Forbearance temporarily reduces or pauses your mortgage payments, providing relief during a temporary hardship, such as job loss or medical issues. AB 2424 encourages lenders to explore forbearance options before proceeding with foreclosure. Refinancing: In some cases, refinancing may help homeowners struggling with their mortgage. By refinancing, you replace your current mortgage with a new loan that has better terms, which could reduce your monthly payments. Short Sale: If you cannot continue making payments, a short sale might be an option. This involves selling your home for less than the amount owed on the mortgage with lender approval. While you won’t keep the home, it can prevent foreclosure and reduce the impact on your credit. Deed in Lieu of Foreclosure: This option allows you to transfer ownership of the home to the lender in exchange for forgiveness of the mortgage debt. It’s an alternative to foreclosure but does mean losing ownership of the property. Available Services and Resources in Los Angeles HUD-Approved Housing Counseling: HUD-certified agencies offer free or low-cost housing counseling to help you explore options like loan modifications and repayment plans. The Los Angeles Housing and Community Investment Department (HCIDLA) can refer you to trusted counseling services in the area. Keep Your Home California: This state-run program offers financial aid to California homeowners in danger of foreclosure, including programs for mortgage reinstatement, principal reduction, and transition assistance. The program aims to help Californians stay in their homes or, if needed, transition more smoothly. Legal Aid Services: Several non-profit organizations in Los Angeles provide free or low-cost legal help for homeowners facing foreclosure. The Legal Aid Foundation of Los Angeles and Bet Tzedek Legal Services can guide you through foreclosure laws, assist in negotiations with lenders, and help you understand your rights under AB 2424. Bankruptcy as an Alternative to Foreclosure For some homeowners, bankruptcy might be a last-resort option to stop foreclosure. Here’s how it can help: Automatic Stay: Filing for bankruptcy triggers an automatic stay, halting all collection activities, including foreclosure. This temporary pause can give you time to reorganize your finances. Chapter 13 Bankruptcy: This option allows homeowners to create a repayment plan to catch up on overdue mortgage payments over three to five years, helping you keep your home and avoid foreclosure. Chapter 7 Bankruptcy: While Chapter 7 may discharge some of your debts, it won’t stop foreclosure if you cannot continue mortgage payments. However, it can help eliminate other debts, freeing up resources for your mortgage. Note: Bankruptcy can have long-term effects on your credit, so consult with a bankruptcy attorney or financial advisor to determine if it’s the best choice for your situation. Practical Tips for Homeowners Facing Foreclosure Stay in Communication with Your Lender: Open communication increases your chances of finding a solution. Avoiding contact can speed up foreclosure. Document Everything: Keep records of all correspondence with your lender and copies of notices, as well as proof of payments and other documentation. Watch Out for Scams: Scammers may target vulnerable homeowners with "foreclosure rescue" schemes. Always work with HUD-approved agencies and trusted legal services to avoid fraudulent offers. Conclusion: Protect Your Home with Knowledge and Support Facing foreclosure is a challenging situation, but with laws like AB 2424, California provides increased protections for homeowners. By exploring your options, understanding your rights, and utilizing available resources, you can take steps to potentially stop foreclosure and keep your home. If you need help understanding your options, I’m here to provide guidance and support to help you through this difficult time. What You Can Do Next If you're facing foreclosure, don’t wait until it's too late. California’s new foreclosure laws give you more time, but it's crucial to act quickly. Contact a professional specializing in foreclosure assistance, who can guide you through your options and help you make the best decision for your circumstances.. Take the first step toward a solution today. Call 818-270-7090 for a free, no-obligation consultation. Together, we can find the best way to protect your home and secure your future. Betty Ortiz I Realtor, SRES, ABR, Relocation Direct (818)270.7090 HomeSmart Evergreen Realty - 18860 Nordhoff St, Northridge, CA 91324
Read more¿Cuánto dinero se necesita para comprar una casa en Los Ángeles?
Comprar una casa es uno de los objetivos más importantes y emocionantes para muchas personas, especialmente en un mercado competitivo como el de Los Ángeles. Sin embargo, uno de los aspectos que más preocupa a los compradores es la cantidad de dinero que necesitan para cubrir los diversos costos asociados con la compra. A continuación, exploraremos los aspectos clave que determinan cuánto dinero se necesita para comprar una casa en Los Ángeles, como el precio promedio de las viviendas, el pago inicial, los gastos de cierre, los costos de mantenimiento y servicios, y las opciones de asistencia para primeros compradores. 1. Precio de la Vivienda en Los Ángeles El mercado inmobiliario de Los Ángeles es conocido por ser uno de los más costosos en los Estados Unidos. Aunque los precios pueden variar considerablemente dependiendo de la ubicación, el tipo de vivienda y las condiciones del mercado, el precio promedio de una casa en Los Ángeles ronda los $800,000. Las propiedades en áreas más deseadas pueden superar fácilmente el millón de dólares, mientras que en vecindarios menos céntricos los precios pueden ser algo más accesibles. 2. Pago Inicial El pago inicial es una de las primeras consideraciones importantes para los compradores de vivienda. Aunque los requisitos tradicionales han sido del 20% del precio de compra, existen opciones de financiamiento que permiten a los compradores hacer pagos iniciales tan bajos como el 3% al 5%. Por ejemplo, para una casa de $800,000, un pago inicial del 20% sería de $160,000, mientras que con un 5%, se reduciría a $40,000. Opciones de pago inicial: Préstamos Convencionales: Generalmente requieren un 10% a 20% de pago inicial. Préstamos FHA: Permiten un pago inicial tan bajo como el 3.5%, aunque suelen incluir un seguro hipotecario adicional. Préstamos VA: Para veteranos y militares activos, estos préstamos pueden permitir la compra sin pago inicial. 3. Gastos de Cierre Además del pago inicial, los compradores deben considerar los gastos de cierre, que suelen representar entre el 2% y el 5% del precio de la vivienda. Los gastos de cierre pueden incluir tarifas de préstamo, inspecciones, honorarios legales, seguro de título y más. Para una casa de $800,000, los gastos de cierre podrían variar entre $16,000 y $40,000. 4. Costos de Mantenimiento y Servicios Una vez que eres dueño de una propiedad, también debes tener en cuenta los costos de mantenimiento y los servicios públicos. Estos costos pueden variar dependiendo de la ubicación y el tamaño de la propiedad. Algunos de los gastos comunes de mantenimiento incluyen: Reparaciones y mantenimiento: Es recomendable presupuestar alrededor del 1% al 2% del valor de la casa cada año para reparaciones y mantenimiento. Seguro de vivienda: Protege tu inversión en caso de desastres o daños. En Los Ángeles, las pólizas de seguro pueden costar entre $1,000 y $2,500 anuales. Servicios públicos: Electricidad, agua, gas y otros servicios pueden sumar entre $200 y $500 mensuales, dependiendo del tamaño de la propiedad y los hábitos de consumo. 5. Programas de Asistencia para Primeros Compradores Para facilitar el proceso de compra, existen diversos programas de asistencia para primeros compradores en Los Ángeles que pueden ayudarte a cubrir los costos iniciales: CalHFA (California Housing Finance Agency): Ofrece programas de préstamos con pagos iniciales reducidos y asistencia en los costos de cierre para compradores que califican. Downpayment Assistance Program (DAP): Algunos programas estatales y locales ofrecen préstamos a bajo interés o sin interés que pueden ayudar a cubrir el pago inicial. Préstamos FHA: Estos préstamos tienen requisitos de pago inicial bajos y pueden estar disponibles para personas con puntajes de crédito más bajos. 6. Preguntas Frecuentes ¿Cuánto debo ganar para comprar una casa en Los Ángeles?El ingreso necesario depende del precio de la casa, el pago inicial, la tasa de interés y tus deudas. Generalmente, las instituciones financieras recomiendan que el pago de tu hipoteca no supere el 28% de tus ingresos brutos mensuales. Para una casa de $800,000, con un pago inicial del 20% y una tasa de interés del 5%, necesitarías un ingreso anual de aproximadamente $150,000. ¿Cuáles son los costos ocultos al comprar una casa?Algunos costos que los compradores a veces pasan por alto incluyen impuestos sobre la propiedad, seguros adicionales como el seguro contra terremotos, y gastos de mantenimiento imprevistos. ¿Existen programas de ayuda para personas con ingresos bajos o moderados?Sí, existen programas específicos para personas con ingresos bajos o moderados, como CalHFA, que ofrece programas de pago inicial y ayuda con los costos de cierre. Conclusión Comprar una casa en Los Ángeles requiere una planificación cuidadosa y un análisis detallado de los costos involucrados. Si bien el mercado es competitivo y los precios son altos, existen opciones y programas de asistencia que pueden hacer que el sueño de tener una casa sea más accesible. Con el apoyo adecuado y una buena comprensión de los gastos, puedes estar bien preparado para hacer de tu hogar una realidad en esta vibrante ciudad. Betty Ortiz / SRES Senior Real Estate Specialist / ABR Acredited Buyer Specialist / Direct (818)270-7090 See What Your Home is REALLY Worth Betty Ortiz has been servicing the San Fernando Valley and surrounding areas since 2007.If you have any questions, would like to to discuss your home's value, or want to see a home in person, please give her a call today (818) 270.7090.
Read moreFeeling Overwhelmed with Home Maintenance? 10 Signs it's Time to Downsize
Not everyone dreams of residing in a mansion, and even those who do may eventually consider downsizing. As your local real estate agent, I frequently assist clients in their downsizing process and emphasize the importance of recognizing the right time to downsize. Timing is crucial, and many clients delay the decision, ending up with a burdensome large house. Knowing when to downsize is key, as delaying can result in significant financial losses and increased difficulty later in life due to health or mobility issues. To help you make informed decisions, We' ve compiled a list of 10 clear signs indicating it's time to downsize; to alleviate concerns, resolve indecision, and empower you to make the right decision at the right time. Here are 10 signs telling you it’s time to downsize.: Monthly housing expenses exceed 30%: According to the U.S. National Housing Authority, established in 1937, spending more than 30% of your monthly income on housing is deemed financially burdensome. Crossing the 50% mark designates you as severely burdened. If a significant drop in income occurs, whether through retirement, salary cuts, or job loss, this could be a sign to consider moving to a smaller place with a more affordable mortgage. Limited leftover cash in your monthly budget: As retirement approaches, using savings to cover housing expenses is a clear signal that downsizing to something more affordable is a prudent move. Planning ahead and downsizing five to 10 years before retirement can result in substantial annual savings. Feeling overwhelmed with home maintenance: Seniors often opt to downsize to alleviate the burden of maintenance tasks, including repairs, painting and lawn mowing. Selling your home while it's still in good condition can save both money and years' worth of maintenance expenses. Your home no longer fits your needs: Challenges related to aging, such as difficulty with stairs, fall risks from a steep driveway, and other inconveniences, may prompt a move to a more suitable home. Planning ahead for these changes is crucial to ensure a seamless transition. You're the oldest resident in your neighborhood: Beyond financial savings, moving to a retirement community offers social benefits, preventing isolation and loneliness. Staying in a neighborhood for an extended period may lead to witnessing neighbors move away or pass away, contributing to feelings of isolation. Converting home equity into income: With as many as 51% of older workers saving less than $50,000 for retirement, some seniors turn to their home's equity for financial support. Downsizing to a less expensive home can be a strategic move to create a steady income stream during retirement. Career or family ties no longer bind you to your location: The rise of remote work opportunities and grown children can free individuals from location-based career ties. Parents whose children have left home have the flexibility to explore more affordable and desirable locations. Unused property (unused rooms or amenities): After children have grown and left, maintaining unused rooms becomes an unnecessary expense. Features like home offices, game rooms, and other amenities may not suit retirement plans but can be attractive selling points. Desire to be closer to family: Many retired Baby Boomers opt to move closer to their adult children. The trend of living near family has persisted, with the Silent Generation being the most likely to buy a home near family and friends. Seeking a lifestyle change: Seniors have diverse housing options, including age-restricted communities, independent living, assisted living, and nursing homes. Lifestyle changes, whether due to physical limitations, medical needs, or personal choices, can be a catalyst for downsizing. It's crucial to emphasize that downsizing isn't exclusive to seniors. Choosing a smaller, more manageable home can free up resources for various pursuits, from working fewer hours to enjoying life through travel, hobbies, or other activities. Whether on the brink of retirement, navigating life changes, or simply seeking a more fulfilling living arrangement, downsizing offers a practical and gratifying choice. Downsizing, especially if you’ve lived in your home for many years, can be an overwhelming—not to mention emotional—process. When you find yourself ready for this significant step, I would love to have a conversation with you about the details of how I can best suit your needs in your particular downsizing situation, contact me today! -Betty Ortiz / SRES Senior Real Estate Specialist / Direct (818)270-7090 See What Your Home is REALLY Worth Betty Ortiz has been servicing the San Fernando Valley and surrounding areas since 2007. A Bachelor's degree in Business Administration and over 19 years of collective experience in mortgage underwriting and real estate give her a strong foundation to protect your interests. If you have any questions, would like to to discuss your home's value, or want to see a home in person, please give her a call today (818) 270.7090.
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