Experts tell how to avoid foreclosure

SALISBURY — At a recent meeting of the Affordable Housing Advisory Committee, member John Harney Jr. brought some startling news — that 10 homes in town were in foreclosure.

Harney, a real estate broker, said he wished to bring the situation to the attention of the committee.

“If we are trying to create affordable housing while this is happening, maybe we should try to get ahead of it,� he said in an interview this weekend.

Harney said his list — now 11 homes — is split about evenly between locals and weekenders, and spans the economic spectrum, from a home in the $150,000 range up to “$800,000 or so.�

And he emphasized these are not the infamous subprime loans, but ordinary mortgages.

Denise Cohn, a senior loan officer with J.P. Morgan Chase who lives and works in Falls Village, said she is seeing a similar trend.

“I’m spending more time giving advice than actually writing mortgages,� she said. “I’ve spoken to maybe 25 people in four of the six towns [in Region One], and if I’ve heard from 25, then...�

A homeowner who receives an ominous letter from his or her bank needs to act quickly, both advised.

“People feel isolated, they don’t know what to do� said Harney. “It’s probably the first time they have encountered a situation like this.�

And Cohn said, “People either ignore it or figure it’s hopeless. What they don’t realize is that with bigger banks it’s all computer-driven. You get behind a certain number of months and the computer spits out a standard letter — an “accelerated payment request� — saying you have 30 or 60 or 90 days to get caught up.�

Cohn advises people to call their bank. If it’s a large bank, it takes patience to get through to a live person, but once through, get that person’s name and phone extension.

With local banks, make an appointment to go in and talk about the situation.

“There is no need to panic. When you apply for a loan modification agreement, payments are frozen until the application is reviewed,� added Cohn.

Harney has first-hand experience with homeless families. “I worked at a shelter in Denver for seven years,â€� he said. “I’ve seen the effects on families of being forced to leave their homes.  It takes them a long time to get back.â€�

He has put forth the idea of the town having a “point person,� perhaps the town’s social worker, to help guide struggling families.

And Cohn, while acknowledging the serious nature of the problem, continued in a proactive mode, advising immediate contact with the lender.

“The bottom line is the banks don’t want these homes.�

John F. Perotti, chairman and chief executive officer of Salisbury Bank and Trust, agreed with Cohn.

“Foreclosure is the last thing a bank wants to do,� he said. “One of the advantages of dealing with local organizations is that our loan officers see our customers, sometimes on a social basis, and know them.

“So customers should feel free to come in if they’re having problems, or they sense they’re going to have problems. If there’s anything that’s going to disturb the weekly cash flow, contact the bank.

“If the bank doesn’t hear anything, it can only assume the worst.�