The lenders will often send you emails and letters notifying you in advance of an impending foreclosure.
Owning a house is the dream of every person, especially those with families. There are many different ways people can own houses ranging from house mortgage financing or buying with direct cash payment. Because of the cost of purchasing the houses, many employed people prefer going for a cost-effective mortgage because of the extended repayment periods.
However, sometimes, people fail to honor the mortgage terms due to financial constraints and loss of employment, leading to foreclosure. Foreclosure is the process by which the lender or bank begins repossessing your house when you fail to pay the mortgage. Depending on the state of residence, there are different ways that foreclosure can be done.
In this article, we will focus on the best way to prepare when facing an imminent foreclosure process.
Engage your lender to forgive a payment
This is the most famous avenue that people facing foreclosure can explore. Here, talk to your mortgage provider on why you have defaulted or why your repayment is late. A proper explanation will give them confidence that your story is right, and the lender might give you a grace period to repay the dues.
Forgiving a late repayment or default payment can be done by reorganizing the repayment plan by increasing time and forfeiting any pending fines. It is also essential to engage your lender early if you know your payment might delay and convince them not to take any legal action against you because of late repayment. With this, you will prepare well and not be caught unaware of an impending foreclosure.
Additionally, you can prepare well for a possible foreclosure by renegotiating the terms of your loan. You can either fast-track the loan to reduce the repayment period and increase the principal amount or increase the repayment period by spreading the cost over a long period at reduced installments.
Seek legal action through the judicial process
Some real estate lenders and mortgage providers find solace in taking defaulters to court. Such lenders are found to secure court orders to evict the defaulter from their premises. However, it is beneficial to the homeowner if you take the first step to court before the lender does. This will give you time to prepare your defense first hand because the legal process may take not less than 12 months.
For instance, in New York, the process takes close to 2 years for the judicial process to be complete. As such, it is vital to get the legal services of a seasoned and outstanding professional to represent your foreclosure defense in court. Many mortgage providers don’t like going through the court process because they are bound to lose.
You are permitted to continue staying in your house during the court case until the case is heard and determined. During this time, you might start looking for an alternative residence or source for another mortgage service from a different lender to buy a new house and start repaying.
Review emails and letters from the lenders and follow-up
Mortgage companies have departments that deal with customer complaints. It would be best to explore all these avenues whenever you are faced with a foreclosure. The lenders will often send you emails and letters notifying you in advance of an impending foreclosure. It is only human that you respond to any demand letter on time.
This can be done by calling the lenders back and explaining the problem affecting your mortgage repayment. Ensure you are in constant communication with the lender to find an agreeable solution for both parties. Replying to urgent emails and letters from the lenders should be your topmost priority when dealing with a foreclosure. This paints a picture of a concerned defaulter willing to find a solution rather than losing their house.
In conclusion, the foreclosure process should not spell doom to you because there are ways of addressing the impasse. As a homeowner, try to explore the negotiation option out of court when faced with foreclosure.
Many lenders are people and companies in business and will not want prolonged court battles with issues sorted out through mediation. Armed with this information, always see foreclosure as an opportunity to find better ways of settling your mortgage debt rather than losing your house.