The rising foreclosures sweeping the country don’t just affect personal finances. They also take an emotional toll on homeowners. Money issues can be among the most difficult, and stress about money can spill over into other areas of life. USA Today reports on on some of the issues surrounding foreclosures:

Crisis hotlines are reporting a surge in calls from frantic homeowners. The American Psychological Association (APA) and other mental-health groups are publishing tips on how to handle the emotional stress triggered by the real estate meltdown. Psychologists say they’re seeing more drinking, domestic violence and marital problems linked to mortgage concerns — as well as children trying to cope with extreme anxiety when their families are forced to move.

“They’re depressed, anxious. It’s affected marriages, relationships,” says Richard Chaifetz, CEO of ComPsych, a Chicago-based employee-assistance firm that is counseling homeowners over mortgage fears. “People tend to catastrophize, and that leads to depression. Suicide rates go up. We see an increase in drinking, outbursts at work, violence toward kids. Before, their houses were like ATMs,” as they rose in value. “Now, they feel trapped like a rat in a corner.”

This is an interesting side effect. Marriage counselors have long pointed out that money problems are a major cause of divorce. And money problems can cause large amounts of stress. And a foreclosure is one big money problem. It’s not surprising that all of these foreclosures seem to be leading up to a national emotional health crisis.

Dealing with foreclosure can be tricky, but it is possible. However, it might be necessary for those dealing with the emotional stress of foreclosure to get some sort of counseling — marriage counseling or treatment for depression or anxiety — in addition to financial counseling.

Tags: foreclosures, mortgage loan blog, home mortgage loan, personal finances,
subprime mortgage, financial counseling, mortgage lenders

The FBI has released its 2007 mortgage fraud report, and it is no surprise that the agency is finding that mortgage fraud is on the rise. Indeed, according to the report, the current mortgage market and real estate market trends are conducive to fraud:

The downward trend in the housing market provides an ideal climate for mortgage fraud perpetrators to employ a myriad of schemes suitable to a down market. Several of these schemes have emerged with the potential to spread as the recent rise in foreclosures, depressed housing prices, and decreased demand place pressure on lenders, builders, and home sellers. Emerging and re-emerging schemes for 2007 included builder-bailouts, seller assistance, short sales, foreclosure rescue, and identity thefts exploiting home equity lines of credit.

It is important to be on your guard at this time. Here are a couple mortgage fraud schemes to be on the lookout for:

• Foreclosure assistance. Beware of those claiming that they can stop a foreclosure on your home. Some scammers will claim that they can stop a foreclosure and help you save your home. They charge a “fee” of between $600 and $2,000 in order to “take care of paperwork” and “negotiate with your mortgage lender.” They have you fill out a bunch of forms, take your money — and your home goes through foreclosure anyway.
• Equity stripping. This is when scammer arranges to take over the loan on your home and let you live there as a renter. It stops the foreclosure, but you are signing your home over. The scammer may charge high rent. At some point, though, you fall behind again, but with no house now. You are kicked out, and the scammer has your home plus its equity.
• Bait and switch. Watch out for this. You are told that you are signing forms that bring your loan current — or restructure it. You pay an “administrative fee” or make a “loan payment.” In reality, the papers have you signing over the deed to your house. So you lose ownership of your house — and the money you paid.

Be sure to carefully examine all documents before signing. Or have a trusted attorney review them. If you are worried about foreclosure, talk to your mortgage lender well in advance and see if you can arrange something. Here are some resources that can help you avoid foreclosure:

• ACORN’s HELP program: 888-409-3557.
• Neighborhood Assistance Corporation of America: 888-302-6222.
• Homeowner’s Hope: 888-995-4673

Tags: mortgage lender, home equity, home mortgage loan, foreclosure,
mortgage fraud, mortgage loan blog, avoid foreclosure

The FBI has released its 2007 mortgage fraud report, and it is no surprise that the agency is finding that mortgage fraud is on the rise. Indeed, according to the report, the current mortgage market and real estate market trends are conducive to fraud:

The downward trend in the housing market provides an ideal climate for mortgage fraud perpetrators to employ a myriad of schemes suitable to a down market. Several of these schemes have emerged with the potential to spread as the recent rise in foreclosures, depressed housing prices, and decreased demand place pressure on lenders, builders, and home sellers. Emerging and re-emerging schemes for 2007 included builder-bailouts, seller assistance, short sales, foreclosure rescue, and identity thefts exploiting home equity lines of credit.

It is important to be on your guard at this time. Here are a couple mortgage fraud schemes to be on the lookout for:

• Foreclosure assistance. Beware of those claiming that they can stop a foreclosure on your home. Some scammers will claim that they can stop a foreclosure and help you save your home. They charge a “fee” of between $600 and $2,000 in order to “take care of paperwork” and “negotiate with your mortgage lender.” They have you fill out a bunch of forms, take your money — and your home goes through foreclosure anyway.
• Equity stripping. This is when scammer arranges to take over the loan on your home and let you live there as a renter. It stops the foreclosure, but you are signing your home over. The scammer may charge high rent. At some point, though, you fall behind again, but with no house now. You are kicked out, and the scammer has your home plus its equity.
• Bait and switch. Watch out for this. You are told that you are signing forms that bring your loan current — or restructure it. You pay an “administrative fee” or make a “loan payment.” In reality, the papers have you signing over the deed to your house. So you lose ownership of your house — and the money you paid.

Be sure to carefully examine all documents before signing. Or have a trusted attorney review them. If you are worried about foreclosure, talk to your mortgage lender well in advance and see if you can arrange something. Here are some resources that can help you avoid foreclosure:

• ACORN’s HELP program: 888-409-3557.
• Neighborhood Assistance Corporation of America: 888-302-6222.
• Homeowner’s Hope: 888-995-4673

Tags: mortgage lender, home equity, home mortgage loan, foreclosure,
mortgage fraud, mortgage loan blog, avoid foreclosure