How To Stop Foreclosure
Avoid Foreclosure and Save Your Home
A loss of a job, mounting medical expenses and other major life-changing events can happen to anyone, causing us to fall behind on our loan payments. If we stop paying our credit card bills it hurts our credit rating, but if we stop paying our mortgage the situation is much worse, because the lender will foreclose, taking ownership of your home.
Stop Foreclosure Now Rules
You must forget about your pride if you are truly serious about stopping foreclosure of your home. Lenders don't want to foreclose on your house, and will often work with the investor you choose to get you back on track.
Rule #1: Contact your lender as soon as you know you will miss a mortgage payments.
Rule #2: Don't ignore your mortgage company's letters or phone calls. Ignoring this foreclosure problem won't make it go away.
Rule #3: Work with a foreclosure specialist (a real estate investor) to save your credit and perhaps even get to keep your home.
Stop Foreclosure Fast Solutions
Stop Foreclosure Fast Solution #1: Reinstatement
Reinstatement may be a possibility when you are behind in your mortgage payments, but can provide a lump sum to bring payments current by a certain date.
Stop Foreclosure Fast Solution #2: Forbearance
With forbearance, you are allowed to temperarily delay your mortgage payments, with the understanding that a different stop foreclosure option will be used afterwards to bring the mortgage account current. Lenders sometimes combine Forbearance with Reinstatement if they know you will have the funds to bring your mortgage account current by a certain date.
Stop Foreclosure Fast Solution #3: A Repayment Plan
If your mortgage account is past due, but you can now make payments, the mortgage lender might agree to let you catch up by adding a portion of the past due amount to a certain number of monthly payments until your mortgage account is current. This is known as a mortgage repayment plan.
Stop Foreclosure Fast Solution #4: Work With A Foreclosure Expert
By working with a stop foreclosure expert, you'll be sure to get the best foreclosure avoidance advice available. They will stop the foreclosure sale and stop the mortgage foreclosure. As an investor, they will solve your foreclosure problems by finding a solution that works for you and the bank.
Stop Foreclosure Help
Stop Foreclosure Help #1: Mortgage Modification
If you can make your regular mortgage payment now, but can't catch-up the past due amount, the lender might agree to modify your total mortgage amount. One solution is to add the past due amount into your existing loan and refinance it over a longer term. Modification might also be possible if you no longer have the ability to make payments at the former payment level. The lender can modify your mortgage to extend the length of your loan, as well as taking other steps to reduce your payments.
Stop Foreclosure Help #2: Selling Your Home
If catching up is not a realistic possibility, the lender might agree to stop the foreclosure process in order to give you some time to attempt to sell your home.
Stop Foreclosure Help #3: Deed in Lieu of Foreclosure
When the mortgage lender allows you to give-back your property and forgives the debt. It does have a negative impact on your permanent credit record, but not as much as a foreclosure does. The mortgage lender might require that you attempt to sell the house for a certain stretch of time before agreeing to this option, and it might not be possible if there are other liens, such as tax liens, against the home.
Stop Foreclosure Help #4: For FHA Loans
The mortgage lender might be able to help you receive a one time payment from the FHA Insurance fund. Your loan must be at least four months past due, but no more than 12 months past due and you must show you are able to begin making your full mortgage payments.
In this situation, you must sign a promissory note which allows HUD to place a lien on your property for the amount received from the fund. Keep in mind that the note is interest free, but must eventually be repaid. You should also know that the note becomes due when you pay off the loan or when you sell the property.
Stop Foreclosure Help #5: For VA Loans
Your local VA Regional Loan Center should offer financial counseling that is designed to help you avoid foreclosure. Call 1-800-827-1000 and ask for the phone number of the Loan Service Representative for your local area.
Stop Foreclosure Help #6: Contact a Stop Foreclosure Counselor
If you do not want to talk with your lender first, you can always contact a Stop Foreclosure Counselor. A counselor can help you determine which options might be available to you and negotiate with your lender to work out a repayment program. This is by far the best option to pursue.
Put the Stop Foreclosure Process in Motion
Your mortgage lender will not automatically put you into a stop foreclosure program to bring your past due mortgage up-to-date. You must put the stop foreclosure plan into motion and provide the lender or the stop foreclosure specialist with the documentation they require to analyze your financial situation.
Although your lender does not want to foreclose on your house if it can be avoided, they do want to make sure you can follow-through on any stop foreclosure promises you make to bring your mortgage account current.
Be prepared to share all details about your financial situation with your lender or Stop Foreclosure Counselor.
- An explanation of your current financial circumstances.
- Details about your current income.
- A list of your household expenses.
The Stop Foreclosure Counselor or mortgage lender will review and analyze your situation before offering a solution to bring your past due mortgage up-to-date.
After Stopping Foreclosure, Repairing Your Credit
If your home loan is past due, you will want to stop foreclosure as soon as possible. Once you do this, you'll want to start repairing the damge that you have done to your credit. To help you with this, a nonprofit credit counseling agency might be able to help you work with your creditors to reduce your monthly payments by lowering interest rates or extending repayment periods.
Please be sure to only use a nonprofit. Steer clear of companies that promise you quick, easy results for all of your credit problems, if you agree to pay them a large up-front fee. You know better than that! That's not how it works in the real world.
Best of luck in your stop foreclosure pursuits!