Stop Foreclosure – Foreclosure Prevention

Archive for November, 2009

Are you a homeowner who has been trying to stop a foreclosure? Within the next few minutes you’ll learn some invaluable foreclosure solutions that will help you save your home and give you peace of mind.

If you are like most folks, you are looking for foreclosure help because of extenuating circumstances that have pushed your back up against a wall. This includes:

•Sudden job loss or lay off
•Family medical emergency or illness
•Death of a spouse
•Divorce or loss of additional income
•Overwhelming debt obligations such as credit card debt
•Decrease in pay
•Inability to handle adjustable interest rates
•Natural disaster or unexpected major maintenance issue

This list could go on and on, but you get the big picture right? As you learn how to stop foreclosure on your house, the main thing to keep in mind is that Lenders do not want to take the necessary foreclosure steps when you default on the loan any more than you do. However, filing a Notice of Default is the only way they can protect their interests.

So, if you haven’t already done so, contact your lender at once. Lay down your pride, and don’t ignore letters and notices from your lender. This approach will definitely cause the situation to get worse.

If you don’t ask, you may never know what other options are available to you. Often times lenders have certain hardship polices in place to help homeowners who have found themselves in a jam. Now is the time to find out how to stop foreclosure before the process begins.

Consider the following options that may be available to you:

Make Up Your Payments In A Timely Fashion – Before starting the foreclosure process and taking legal action against you, your lender may be willing to let you work out a type of repayment plan. This is typically called forbearance and allows you to make up missed payments in a manner that is affordable for you.

Forgive Your Missed Payment – In some instances, the lender may be able to waive a missed payment. Debt forgiveness is not common; however, it may be an option for you depending on your previous payment history.

Rework The Terms Of Your Loan – For adjustable loans, your lender may opt to freeze the interest rate before it jumps sky high. They may even change the interest rate all together to a rate that works out better for you.

Refinance And Tack Back Payments To Your Loan Balance – With the right amount of equity and meeting specific guidelines, your lender may be able to increase the full amount of your loan by adding back payments and re-amortizing the loan.

Apply For A New Loan – You may qualify for certain government loans that allow borrowers to apply for a partial claim loan to pay back any missed payments.

Short Sale – You may be a good candidate for a short sale where you negotiate with your lender to sell your home even though your home is worth less than what you currently owe.

Deed-in-Lieu of Foreclosure – Think about deeding your home back to the lender. If the lender agrees, they will forgive the mortgage and cancel foreclosure services.

Know that foreclosure isn’t the end of the road. By exercising any one of the options listed here, you may be able to save your home or get out of a mortgage you can no longer afford. There are many ways to stop foreclosure, you simply need to decide what route is best for you and then take action.

Loan modification is a term that many homeowners are becoming all too familiar with as the foreclosure rate is at its peak. Loan modification is an alternative to foreclosure that can assist the homeowner in maintaining ownership of their home. Mortgage brokers and lenders have been receptive to the theories of loan modification as the process of foreclosure is lengthy and expensive.

Loan modification is the process of negotiating with the mortgage lender to decrease the amount of the loan. This can be done one of two ways; one, by lowering the interest rate which is associated with the loan and two, by increasing the term of the loan.

It is important to remember that there are fees which are associated with the process of loan modification. Traditionally, negotiating with the lender is one of the most inexpensive ways to reduce the payments each month. As an alternative, organizations are available that negotiate with the lender on behalf of the homeowner for a small fee. In many cases, unless the negotiations have reached the goals of the homeowner and reduced the payments of the mortgage, this fee is waived.

These negotiations can be completed in as little as six weeks and will allow the payments to become more affordable by the homeowner. Not only does the homeowner benefit from the lower payments each month, which can ease stress on the finances, the lender does not have to worry about having to recover costs through foreclosure.

Foreclosure is avoided by lenders, unless it is the last possible option to regain the funds which have been lost through the defaulting process of the mortgage. Foreclosure is a lengthy and expensive process that can cause a loss on the part of the lender with the current state of the economy. There are more homes being sold, than homes which are being bought – and therefore homes may sit on the market for months before being sold. Throughout this time, the lender is still accumulating interest charges and finance fees which require the sale of the home in order to be repaid.

Acting early can be the best way to deal with an overwhelming mortgage payment. If there has been a change in the financial situation that means the homeowner will be unable to make the monthly mortgage payments, it is important to notify the lender quickly as more options are available to those that act early than those that have waited for the foreclosure process to begin.

See, there are alternatives to foreclosure. Loan modification to avoid foreclosure is a way to not only maintain ownership of the home, but pay less each month and ease the stress which is placed on the finances.