Discussing money is difficult - even in the best of circumstances - but trying to talk about money while going through a divorce is mindboggling.
The common asset most couples know they must talk about is their home. It's the one asset they purchased together shortly after getting married, or the one they lived in while raising the kids.
But what happens when the home is in jeopardy? What happens when the home values fall and making payments becomes a struggle? What do couples do?
One thing that is abundantly clear is that you are not alone and that there are others like you in a similar situation. About 1.5 million households received at least one foreclosure-related notice in the first half of this year, according to RealtyTrac Inc. According to Michael Barr, the Treasury Department's assistant secretary, the government has 38 companies participating in their $50 billion program to ease the mortgage crisis, yet they recognize that it is only reaching a small number of homeowners.
The government knows that banks have not done enough since they have only extended 400,000 offers among 2.7 million eligible borrowers who are more than two months behind on their payments. They are aware of two lenders - Bank of America and Wells Fargo - who have lagged behind expectations after having received billions of federal bailout money. B of A modified just 4% of its eligible loans and Wells Fargo 6%. However, the good news is that both Wells Fargo and B of A said that they have plans to speed up their efforts.
And there are companies who have made strides to assist the troubled homeowner. Saxon Mortgage Services, Inc. has helped one in four eligible borrowers with a trial loan modification that lowers the monthly payment to help the homeowner avoid foreclosure. Also, Aurora Loan Services LLC, GMAC Mortgage Inc. and JP Morgan Chase all had one in five qualified borrowers in a trial loan.
So if you are in a financial bind, contact your bank or a mortgage broker to see what they can do for you - they just might be able to help. Also, share with your spouse and your divorce professionals - especially if you are working in the Collaborative Divorce model - the financial hardship you are living through. Communication between you and others is a must during this financial crisis, for solutions are only possible when troubles become known.
Respectfully submitted,
Steven B. Garelick, CPA, ABV, CVA, CFS, Mediator
Partner, Senior Litigation Case Manager
e-mail: sgarelic@miod-cpa.com
Miod and Company, LLP, CPAs
http://www.miod-cpa.com
