Be proactive about the problem when the first warning signs appear.
Contact your lender when you become aware that you have a problem. The last thing that a lender wants is to foreclose on the property. Financial institutions lose a significant amount of money by foreclosing on a property...they are in the Lending business not property management business. Foreclosure is a lose/lose for the lender and the homeowner. It is important to be honest and forthright with your discussions and be prepared to discuss the reasons for your problems.
Read your mail. Not knowing does not solve the problem it just delays the final result and increases the pain.
Prioritize your spending. Pay the house payment and health insurance first.
Look for ways to generate cash.
Don’t get scammed by a private “foreclosure prevention specialist,”
Make an appointment with a CDPE (Certified Distressed Property Expert) and SFR (Short Sale & Foreclosure Resource Certified) REALTOR® to discuss the problem and to get advice
Foreclosures are Public Record Forever... Don't Give Up...Explore Your Alternatives Home Loan & Credit Applications Ask - "Have you EVER had a Foreclosure or Bankruptcy?"
Foreclosure Alternatives
Reinstatement Homeowner requests the total amount owed to bring mortgage payments current and pays it.
Forbearance or Re-payment Plan Homeowner negotiates with the mortgage company to allow them to repay back payments over a period of time.
Sell the Property Homeowner with sufficient equity lists their property with a qualified agent that understands the foreclosure process in their area.
Rent the Property Homeowner with a mortgage payment low enough that market rent will allow it to be paid converts their property to a rental.
Mortgage / Loan Modification Homeowner negotiates with lender to modify the interest on the loan, the principal balance, or any combination of these, resulting in a lower payment.
Home Affordable Foreclosure Alternatives Program (HAFA) Homeowner qualifies for HAFA and is offered pre-approved short sale terms and cash incentives for relocation assistance.
Short Refi Homeowner negotiates with lender to refinance a mortgage for less than what is owed on the property.
Deed-in-Lieu of Foreclosure Homeowner returns the property to the lender rather than go through the foreclosure process.
Deed for Lease Homeowner returns the property that is FHA-insured back to the lender and leases the property for a twelve month period.
Refinance Homeowner with significant equity in his/her property and good credit standing refinances their mortgage.
Bankruptcy Homeowner with significant non-mortgage debt who is unable to pay these debts or his/her mortgage payment files for bankruptcy which liquidates assets and/or reorganizes debt to pay back creditors.
Servicemembers Civil Relief Act (SCRA 303) A member of the military who is experiencing financial distress due to deployment (and can prove entered into debt before employment) qualifies for temporary relief under this act.
Homeowners Assistance Program (HAP) A member of the military or federal employee qualifies for this program which has a variety of assitance programs including private sales, government purchase, and/or foreclosure assitance.
Short Sale Homeowner has a financial hardship and qualifies for a sales transaction where the lender is willing to accept the payoff of a mortgage for less than what is owed.
This information is made available by Brian L. A Wess as a public service and is issued to inform, not provide legal advice. No person should attempt to interpret or apply any law without the assistance of an attorney. The information is intended as general information only, and is not meant as legal advice for any specific situation. If you need legal advice, consult an attorney.
