The Sky if Falling, nope just house prices...or your principal balance?

Happy New Year!  I just wanted to start off by stating that I was right and it sucks for most of my clients.  Last year I claimed that our market would see an average decline of about 1% per month.  In yesterday's Seattle Times, the   amount was 13.5% for the King County area or about 1.125% per month.  The article explained that even though the volume in home sales is up, the median price is dropping because the banks are increasing the number of foreclosures.  There is glut of bank owned and pre-foreclosure short sale properties causing the housing prices to drop.

This is not news.  If you followed this blog, you know I have been beating this drum for a while now and I am afraid you are going to tune me out.  I probably deserve it, but what if it weren't the sky, I mean your house price dropping, but your principal balance?  That would be news.

Last year, Gov. Gregoire signed the foreclosure fairness act under HB 1362.  This bill gives homeowners the right to force the bank to come to the table to mediate the differences that the homeowners have with the banks.  We aren't really trying to pick a fight, but if you want one, its as good a place as any to have it out with your bank.

It has finally been proven that the banks can be beat in the mediations.  The sticks are myriad to use, but there is a possibility of getting a principal reduction in the mediation.  I am not to the point that I believe this is the norm, but something that is feasible.

My offices have been presenting referrals to mediation for homeowners since the law came to fruit on July 22nd of last year and we have a track record of getting concessions for homeowners.  If you are in the Snohomish area and would like a chance to chat, give me a call, but if you are simply seeking guidance, I would recommend you sit down with an attorney and discuss your options.  You have a limited time window, 30 days in which to gain the most effect from the law. 

Just know, that despite the fall in housing prices, there is a possibility that you could make it fall in tandem with your principal balance, or at least have a forum to give the bank a piece of your mind and they have to sit there and take it.