HelpHomeowners.Org
KeepHomesKeepLoans.Org

Helping Homeowners Keep Their Homes, and
Lenders Keep Their Loans! ™

Solutions to the Mortgage Meltdown: From All Sides™ - 2007-2011
HelpHomeowners.Org | KeepHomesKeepLoans.Org
Help4ThePeople.Org - Homeowner Solutions
HotNeutral.Com - Lender Solutions
Solutions Offered By Richard Ivar Rydstrom, Esq.

rrydstrom@gmail.com

We all know the rising threat of defaults and foreclosures facing America is currently harming the economy, and potentially creating a serious social problem for the greatest example of democracy in the world today. We all know that we must do everything in our collective power to help homeowners stay in their homes, and at the same time, help lenders keep their loans. This is good for us all. The solution should not be couched in polar divisive politics, nor should the solution be a ‘bailout’ of one interest over another. Neither bleeding hearts nor cold business greed should guide the solution, but, recognition in a few basic American principles must be our prerequisite. We can, and must ‘bailout the economy - and homeowners sinking in debt’ while retaining sensitivity to ‘free but responsible open markets’. If we don’t we will flirt with ‘actual recession’ or worse. Then we will all suffer. We must all respect the various interests around the table starting with 5 simple premises:

• First, we must aim to help homeowners keep their homes, and lenders keep their loans;
• Second, we must aim to enhance sustainable homeownership and the economy at the same time;
• Third, it took us all to get into this mess, and it will take us all to get out of it; so no one interest should necessarily suffer over the other;
• Forth, this is exactly the kind of mess that government should help fix and safeguard for the future; including use of private-public solutions;
• Fifth, we must aim to avoid boldly adding restrictive non-comprehensive regulations, when we can use intelligent refinement as our regulating barometer 

Immediate Short Term Solution: Loan Workouts!

The immediate solution is ‘loan workouts’. We can’t do loan workouts if the lender and the homeowner don’t communicate and come to a negotiated solution. Borrowers don’t want to talk to their lender, servicer or the bank’s foreclosure attorney, for reasons of embarrassment to conflict of interest. The bank’s foreclosure attorney (and lender) clearly has a potential conflict of interest that the borrower (and the lender) should want to avoid. At present, when the parties do talk, the negotiations are cumbersome, slow and tend to add to the problem, not solve it. Borrowers have a lack of knowledge resulting in a lack of bargaining power. Lenders are overburdened and too slow. We need:

• (1) Preset acceptable minimum loan workout norms that both homeowners and lenders understand are available as solutions, and that serve the interests of all participants;
• (2) Neutral specialists to enhance the bargaining power of the weaker party in the negotiation, the homeowner

The national 800 and HUD numbers work good for credit counseling with respect to ‘how to live within a budget’, but are simply not setup to supply the necessary specialized loan workout knowledge necessary to enhance the homeowner’s bargaining position, and successful result. The author developed Help4ThePeople™ (www.help4thepeople.com) as a free public educational outreach program for homeowners facing default or foreclosure. As of August 31, some attorney (state) associations have stepped up to train volunteer attorneys to act as homeowner representatives. The author applauds this recent development following his introduction of the first example of specialized attorney loan workouts, called HotNeutral™ (www.hotneutral.com). Neutral representatives must be in the middle of the loan workout-circle, with mutual waivers protecting the homeowner and lender (servicer) from liability for the terms of the loan workout. This will allow everyone to expedite preset criteria that will result in expedited loan workout solutions. Effective loan workouts are the first of many private-public steps needed to resolve this growing problem.