The Mortgage Makeover: Helping people in the Carolinas avoid foreclosure

MURRELLS INLET -- Many experts say the worst of the recession is behind us but the nation's housing crisis is far from over.

More than 25,000 foreclosures were reported in South Carolina last year alone and more than two million more homes in the U.S. are expected to face foreclosure in the next year.

But there are ways you can avoid the fate of foreclosure.

Martha Mountain of Murrells Inlet was able to save her home from foreclosure through a mortgage makeover.

In 2007, Mountain’s husband Mark died unexpectedly.

Then she lost her job.

Without her husband's support and a stable paycheck, Mountain feared losing her home.

“I even had notes and things left on my door. I actually had a strange woman show up in my backyard one day when I was outside, you know, talking about foreclosure. So, it was very scary,” said Mountain.

With the bills and letters mounting and with her bank account dwindling, Mountain was desperate. She took her neighbor's advice and called Family Services in Charleston.

The agency offers free counseling to at-risk homeowners.

They are an accredited agency approved by the federal government.

“The first thing we try to do is figure out can the person save the property and why they got behind. With those two key pieces at hand, we gather all their information, we go to their lender, and we figure out what opportunities the lender has for helping homeowners keep their homes,” said Toby Smith a Foreclosure Task Force Area Representative at Family Services.

“And before I knew it I was getting phone calls telling me what I needed to do and I did and they've just been, they were a source of hope for me because I thought I was going to lose my home,” said Mountain.

“Nowadays, most lenders have a workout package that the homeowner submits and we help them do that and then from there it's a waiting game,” said Smith.

With the help from counselors, Martha waited three months to hear back from her lender - Bank of America.

Eventually they agreed.

Mountain was struggling to pay $1,089 a month under her original mortgage plan.

Under the new modified plan, she pays $758 a month, about $341 less each month.

She'll have to pay off her mortgage for an extra ten years, but at a rate she can afford.

It's the ideal outcome for anyone who turns to family services help.

“This is my home and I’ll be able to stay here and I hope to stay here until they wheel me to a retirement center,” said Mountain.

And if she passes a mandatory three month trial, Mountain will be able to leave her home when she wants to and not when a bank forces her out.

Unfortunately, not everyone qualifies for this service.

You must prove you have a stable source of income to cover a modified rate.

Counselors also warn there are a lot of mortgage refinancing scams. Smith says you should watch out for groups or agencies that try to charge you for their services because it’s usually a red flag.