THE SOBERING fact about the softening American economy is that it's beginning to spit out real, live victims - many of them homeowners.
Last month alone, American businesses cut more jobs than in any one-month period since the recession of 1991. And 163,000 employees were touched by new layoff announcements - job-loss time bombs set to go off in the months just ahead.
Unlike the last economic down cycle, however, this time around there are far better remedies available to homeowners who lose their jobs, fall behind on mortgage payments or start sinking into serious delinquency.
There are even attractive options for would-be homebuyers who assume they're locked out of the market because of employment-related credit problems. They're not. The fact is that 2001 is a whole new ball game for homeowners and homebuyers alike.
Here's why. During the past 10 years, mortgage lenders have become far more sophisticated in dealing with borrowers and loan applicants who have economic battle scars.
In 1991, mortgage lenders' typical response to a job loss was, "We're truly sorry about your trouble, but if you don't pay the mortgage, we're going to have to take away your house." Today, the predominant response is: "Let's see if we can come up with a way to help you through this rough patch. Let's try to work this out."
The two biggest sources of American home mortgage money - Fannie Mae and Freddie Mac - don't just endorse this approach, they require it.
Mortgage companies who do business with Fannie and Freddie are expected to work aggressively to avoid foreclosures. The same generally is true for independent lenders who retain and service the mortgages they make. Many now offer flexible programs designed to allow homeowners facing temporary interruptions of income to defer a portion of monthly principal or interest for short periods.
Others - generally smaller, depository institutions - may have no formal programs of forbearance for employment-troubled clients, but will seek to accommodate reasonable requests for limited periods.
"Nobody in his right mind wants your home," said mortgage marketing consultant Allen L. Hardester Jr., who is based in Columbia. "If you get into trouble and contact your lender early in the game, you now have a very good chance" of working out some solution to your problem.
Among the most common techniques are repayment plans and loan modifications that see you through your time of stress.
