Tips to Help You
Stop Foreclosure
Foreclosure Rates Are Soaring! Avoid Being a Statistic
By Simon Volkov
Takeaways
If you are facing foreclosure, chances are you're a nervous
wreck. After all, the possibility of losing your home is
scary. However, all is not lost until a judge slams his gavel
on the bench and claims your house to be foreclosed.
In order to stop foreclosure, the first
thing you need to do is stop avoiding the process.
When people fall behind on their mortgage payments, more
often than not they quickly turn to avoidance. Foreclosure
affects people mentally and emotionally. It stirs up thoughts
and feelings that can create immobilizing fear; paralyzing
the mind and halting the ability to become proactive.
While it might seem a daunting task, if you want to stop
foreclosure, you must contact your lender. Typically, you
will be assigned to a Loss
Mitigator who will work with you and help determine
which plan of action is best suited for you. If your lender
does not have a Loss Mitigation Department, or if you are
uncomfortable working with the Loss Mitigator assigned to
your case, you can hire a private loss mitigator to assist
you.
If you have the ability to pay the past due balance, the
lender may simply reinstate your loan. More often than not,
you will be questioned about what caused you to fall behind
on your payments. Your lender might offer credit
counseling classes or provide resources to help
you better plan for the future. Chances are you will be charged
late fees and accrued interest on the past due balance.
If you are unable pay past due mortgage payments your lender
may offer the option of a Forbearance Agreement. This
agreement might transfer the past due balance to the end
of the loan or temporarily reduce or suspend payments. You
will be in a better position to negotiate if you are able
to offer a portion of the past due amount. However, if you
don't have any cash, do not allow it stop you from asking
for a Forbearance Agreement.
If you are able to show a good faith effort, lenders will
be more willing to work with you. Devise a repayment
plan and provide proof of your income and expenses.
Make certain the plan is one you can realistically live with
and do whatever it takes to stick to it. If you fail to make
timely payments, your lender won't be as willing to give
you a second chance.
Another way to stop foreclosure is to sell your
home. This option is best for individuals who
have equity in their property. It can be challenging to
locate a real estate agent willing to list homes without
equity. Reason being when a realtor sells your home, you
have to pay them a commission fee. If you don't have any
equity, there is no cash to cover the realtor's commission.
If you aren't able to find a realtor, you can attempt to
sell your home on your own. This can be tricky and cost you
a fortune if you don't know what you are doing. If you decide
to go this route take time to educate yourself about the
process. Conduct research online, at the library, or attend
real estate seminars. Arm yourself with knowledge or you
could end up in worse shape than you are right now.
When you place a "For Sale by Owner" sign in your
front yard, be prepared to be contacted by companies offering
to buy your home. The majorities of these unsolicited offers
are scams and should be tossed in the trash. When these people
contact you it's crucial that you be extremely skeptical.
While there are legitimate home buying businesses and private
real estate investors that will purchase your
home, many are only out to pull the wool over your eyes and
leave you holding the bag.
A third option to stop the foreclosure process is referred
to as a Deed in Lieu of Foreclosure. This
process allows you to give your house back to the lender.
You voluntarily leave the home and the bank sells it through
public auction.
A Deed in Lieu of Foreclosure does not protect your credit,
but it does allow you to walk away from the home and the
mortgage payment. However, if there are any liens against
the home, you are still obligated to pay them.
Last, but not least, you might be forced into bankruptcy to
stop foreclosure. Recent changes in bankruptcy laws have
made it more difficult and expensive to file. There are several
types of bankruptcy chapters, so it's best to hire a bankruptcy
attorney to help you determine which chapter is best for
you.
More resources
Affordable Housing Institute ~ http://www.affordablehousinginstitute.org/
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