Although borrower is approved for ample social security benefits, lender won’t hold off on foreclosing.
Today I had a client who wanted to bang his head against a wall. His name is Will, and he is three months behind on his mortgage. This poor guy had fallen ill this past year, went into the hospital and then was laid off. When his employer called to tell him not to come back to his job, Will filed for unemployment benefits. Being 63 years old, he decided to retire and so he also filed for social security. He was told by these different agencies that he would qualify for all three benefits. With his pension, the total income would be $3,900 per month. His house payment was only $750, and once those benefits kicked in, he would easily be able to resume making his mortgage payments.
But Will wasn’t paid while off work, and he fell behind on his mortgage. Wells Fargo had already sent him a notice of intent to foreclose.
The problem was that Will would not begin to receive the benefit money for at least a few months. But, Will did have the award letters verifying the amount of money he would be getting, and so he could prove what his income would be in the near future.
Now, I always hear spokespeople in the mortgage business say that lenders do not want to foreclose on anyone, and only do so as a last resort. So you would think that a mortgage lender would be willing to work with a person who can prove that their income will be going up to a level where they can afford to again pay their debt.
We called Wells Fargo to see if they would be reasonable. They wouldn’t.
We were told that even though Will could provide a copy of his awards letter, proving how much he would receive in income, Wells Fargo might decide at any time to begin foreclosure proceedings.
“Sir, the mortgage companies say repeatedly that they have far too many foreclosed properties and that they don’t want to take anybody’s home,” I said. “I hear and read that all the time. If that’s true, just give him time to start getting his money. If he doesn’t start making his payments then go ahead and do what you have to do. But he was told he’d be getting four grand a month, and he’ll be able to repay the missed payments. Why can’t you just hold off foreclosure for two months?”
“Sorry sir, but there’s nothing we can do unless he makes his payments,” he said, sounding like a robot.