Lynn seminars teach homeowners how to avoid mortgage foreclosure

LYNN ? The nation’s soured economy is taking its toll on homeowners who, unemployed and overwhelmed, are thrust into mortgage foreclosure.In an effort to halt that process, Lynn Housing and Neighborhood Development (LHAND) is hosting a series of free workshops that aim to teach homeowners how to hold on to their properties. The next clinic is scheduled for Jan. 12, at LHAND headquarters, 10 Church St., from 5-7 p.m. Anyone interested in attending or seeking more information can contact Erin Ford, LHAND special projects coordinator, at 781-581-8609.At the last clinic, Michael Raabe and Robert Perkins, both attorneys at Neighborhood Legal Services, presented strategies to distressed homeowners. “We focus on loan modification and how to restructure your debt,” said Raabe. “We represent people in predatory lending situations, but that crisis has moved past predatory loans. It is now affecting average people who are out of work and who cannot pay their mortgages.”Hundreds of Lynn families are in this predicament, he said.The same solution isn’t for everyone. That’s why the attorneys explain the nuances of repayment plans, loan modifications and forebearance agreements.A repayment plan distributes your delinquent payments over a period of time, usually no more than 10 months. It helps if the borrower has only a small number of missed payments.Loan modification is a permanent change in the loan that reduces the monthly payments over a longer period of time. It may translate to a reduction in the interest rate or an extension of the loan term. Past-due interest and escrow may be added to the unpaid principal balance.A forebearance agreement is essentially a plan to reduce or suspend payments for a short period of time, due to special circumstances.These are the most common solutions for bringing a homeowner’s account up to date so that they can prevent foreclosure. Other strategies include partial or advanced claims, which are loans from the U.S. Department of Housing and Urban Development that help pay for past-due interest and escrow. With the partial claim, the loan is interest-free and becomes due when the mortgage is paid off or the home is sold.Homeowners can also investigate a possible refinancing with a FSA-insured mortgage, or through Mass Housing. The latter requires a counseling component.Non-curable situations occur when income sources are lost and cannot be recovered for a long period of time. In such cases, a short sale of the property may become necessary. Homeowners can also try to transfer their property voluntarily to the lender in exchange for a release of all mortgage obligations. This process is known as deed in lieu of foreclosure.The free clinics are supported by a grant from the United Way of Massachusetts Bay and Merrimack Valley.