Financial setbacks could likely happen, which is why it’s important to inform your lender right away so they can help you as quickly as possible.
Foreclosure may happen to those who are not paying their mortgage payments. The legal meaning of foreclosure is basically when your lender takes over your home if the payments are not made for consecutive months. When a foreclosure occurs, you must move out of your house. This can become a very stressful and difficult situation for anyone involved, so here are a bunch of tips on how to prevent foreclosure before it happens.
What is Forbearance?
If there is a serious reason behind why you haven’t been paying your mortgages, such as a medical emergency or a sudden and unexpected decrease in income, your lender could possibly grant you a forbearance. Depending on your circumstances, your lender could temporarily lower your payments or even pause them for a certain amount of time. In order to go through with this agreement, you will have to abide by the new repayment plan entirely.
Contact Your Lender
Do not wait or ignore the problem, the further behind you become the harder it will be to reinstate your loan. Contact your lender as soon as you notice a problem, they will be able to give you options that can help you through difficult financial situations.
What is Mortgage Modification?
Loan modification lets you refinance your mortgage loan or prolong its term. A loan modification is the best way to stop foreclosure and have the ability to stay in your home. It’s very important that you act fast and have all of the needed information.
Understand Your Mortgage Rights
Locate any loan documents and read them carefully so that you understand what your lender could possibly do if you don’t make your mortgage payments. It’s crucial that you also understand the foreclosure laws and timeframes of your particular state.
What is a Short Sale?
This is when you owe more money than the market will pay, so your lender lets you sell your home for less than what you owe. It is up to the mortgage lender to allow the short sale, and the process must be done early because this type of property transaction can take a while to complete.
Contact an Attorney
If you are facing foreclosure, there are a series of steps that are critical to understanding. There are important deadlines and mail that need to be answered quickly, which could be the difference between staying in your home or not. Not all foreclosure cases are the same, and that is why it’s important to contact an experienced foreclosure attorney that can help you come up with a plan to stop foreclosure.
The Bottom Line
As a homeowner, it is important that you take all of the necessary steps and precautions to prevent a foreclosure from occurring. The best advice is to stay away from situations that could cause one, such as excessive debt, lack of insurance, or buying a home you cannot afford.
Financial setbacks could likely happen, which is why it’s important to inform your lender right away so they can help you as quickly as possible. Typically lenders aren’t interested in foreclosing on your house, only as a last resort, because of the overall cost and time spent on the process.