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By Christine Dunbar
We all know that job loss, less income, sickness, or death can result in harsh times. Losing your home doesn’t have to be the option. There are ways to slow the foreclosure process, or avoid foreclosure all together. Know that every situation is different in its own way.
Complete communication with the mortgage holder is number one. If you know you can’t pay one month chances of paying two months gets harder. After that you know it is hard to play catch up. Once you start to fall behind, start working on a repayment schedule and let that mortgage company know what is going on. Don’t avoid them, tell them the situation and see if they can help. There are ways of avoiding foreclosure.
Different states have different laws when it comes to avoiding foreclosure. Avoiding or slowing the foreclosure process can happen with these choices: reinstatement, refinance, sell the home, bankruptcy, or loan modification.
Reinstatement is when you catch up on all the past due payments and late fees to current. Some mortgage companies will let you do payment arrangements to catch up the past due payment. However, if you are starting in the foreclosure process reinstatement may not be for you. Reinstatement figures in foreclosure process include attorney’s fees, late fees, and past payments. With today’s society and most people are living paycheck to paycheck, it would be more difficult to come up with this kind of payment.
Refinancing is when the owner goes out to secure a new loan to pay off the delinquent loan. Since the owner is behind on the current loan, banks usually don’t loan money unless you have equity in the property. In today’s time with home values going down, it is hard to get a refinanced loan to avoid foreclosure.
You can always place your home up for sale. If you have no equity, selling your home may be an option. However, with home values low now you may not be able to sell for what you owe. Plus it can take more than a year to sell your home, leaving you still financially distressed. This isn’t a good option if you are trying to avoid foreclosure.
Bankruptcy puts a stop to the foreclosure process in all areas. If you are really struggling with paying for your house this could be an option for you. Lenders will petition the court for a stay, releasing the property, which will be granted unless you have a lot of equity in your home that would be considered an asset to the court. Once property is released from bankruptcy, the foreclosure picks up right where it left off. This will slow but not stop the foreclosure process.
Loan modification is when the lenders have the ability to modify the terms for the original note. Some modifications include interest decrease, extend the amount of time to pay back the loan, or reduce the principal. In today’s times this is the best option to avoid foreclosure. Most modifications will take anywhere from thirty days to one hundred and eighty days. They are offering at this time trial payments which are a lot lower than the actual loan payment during the time they are working on your modification. Most people qualify for a modification if you have a decrease in your monthly income. If you are in the foreclosure process you will remain until they approve you for the modification. However, this can stop your foreclosure process, but once you become delinquent again, there will be no turning back from foreclosure.
In conclusion, never feel you have to let your dreams go. They are ways around foreclosure, but once you start to fall behind, don’t ignore the situation, stay on top of it. You will succeed in avoiding and stopping foreclosure if you plans are to stay in your dream home.
About the Author: Christine is a real estate expert who enjoys writing about how to
avoid foreclosure in Houston
avoid foreclosure in Houston.
Source:
isnare.com
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