Hundreds of local residents (who are in trouble with their mortgages) met with their bankers, Wednesday, in an effort to get a better deal – or at least clarify their options. A seven hour event took place at the Show Place Arena in Upper Marlboro.
The program is called Hope Now Alliance, and it began during the Bush Administration, when the housing crisis was building.
Gerik Lawrence, a civilian employee of the defense department, says he made some bad decisions after buying his house in Forestville in the year 2000.
"During that era, there was a lot of people telling me things that I could do, and what I could do financially – get better loans, ARMS, you know," Mr. Lawrence recalls, then, shaking his head, he added, "I should have studied more. Balloon payments came up, [and] I tried to get out of that, [but] I got caught in a cycle."
Mr. Lawrence got a meeting with his own mortgage company, and is walking out of here with a new deal that will lower his mortgage by about $600 a month.
Why are the major banks (and other mortgage lenders) modifying the deals? Because foreclosure is very expensive.
Eric Selk, the deputy director of the Hope Now Alliance, estimates that the average foreclosure costs the lending institution about $75,000.
Organizers estimate about a third of those who come in seeking mortgage counseling get a new deal from their lender with a lower monthly payment.
This mortgage-advice event was free. But not all mortgage advice is free, and some companies who take your money don't give you very good advice.