Six Ways to Avoid Home Foreclosure When You Can’t Afford Your Mortgage Loan

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If you simply can not afford your mortgage loan you should act fast. What to do when you don’t want to be the upcoming foreclosure next door! After all don’t you see the houses in foreclosure around you? So here is what to do when you can’t afford to pay what the mortgage lender wants you to pay!

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Six Ways to Avoid Home Foreclosure When You Can’t Afford Your Mortgage Loan

  1. 1. Presents:Six Ways To Avoid Foreclosure When You Can’tAfford Your Mortgage Loan
  2. 2. Six Ways To Avoid Foreclosure When You Can’t Afford Your Mortgage LoanIf you simply can not afford your mortgageloan you should act fast. What to do whenyou don’t want to be the upcomingforeclosure next door! After all don’t yousee the houses in foreclosure aroundyou? So here is what to do when you can’tafford to pay what the mortgage lenderwants you to pay!
  3. 3. Six Ways To Avoid Foreclosure When You Can’t Afford Your Mortgage Loan1. Contact Your LenderA lot of people lose their homes to foreclosure out of sheer denial.Unfortunately, ignoring a foreclosure notice will not make the problemgo away. In fact, the longer you wait, the more you reduce the optionsavailable. That’s why as soon as you run into trouble with paying themortgage, you should contact your lender to see if you can worksomething out.According to the U.S. Consumer Financial Protection Bureau, youshould be prepared to discuss why you can’t pay the mortgage,whether the situation’s only temporary and details about your income.For lenders, helping a borrower keep the home can be a best-casescenario, especially at a time when the market may already be floodedwith other foreclosed properties. You can also contact the ConsumerFinancial Protection Bureau to talk to a housing counselor about youroptions.
  4. 4. Six Ways To Avoid Foreclosure When YouCan’t Afford Your Mortgage Loan 2. Refinance Refinancing a home can be an option, but only for buyers who aren’t already stretched to the max. For example, if you’re on track to pay off your mortgage in 10 years, you could extend the amortization of the loan, thus making the payments smaller. Keep in mind, however, that refinancing often includes some pretty hefty fees (for breaking your existing mortgage contract), and may also cost you more in interest over time. For those who are already overextended on the loan, refinancing may not be an option at all.
  5. 5. Six Ways To Avoid Foreclosure When YouCan’t Afford Your Mortgage Loan 3. Apply for a Loan Modification A loan modification is when a homeowner works with a lender to change the terms of the mortgage loan. This could mean a temporary or permanent change to the mortgage rate, term and/or monthly payment. This option is similar to refinancing, but it’s only open to those who can prove they’re facing great financial hardship — and who are willing to advocate for themselves to a lender that is probably receiving many other similar requests. This option is part of the Making Home Affordable Plan, which was designed to help offset some of the dishonest lending practices that left many homeowners in the lurch. However, it may take many months for borrowers to be approved for this program, so it’s hardly a quick fix. Plus, it’s only open to homeowners whose first mortgage originated before January 1, 2009, and whose unpaid balance on the mortgage is not more than $729,750. You can look into whether you qualify here.
  6. 6. Six Ways To Avoid Foreclosure When You Can’t Afford Your Mortgage Loan4. Get Rid of Your HouseSometimes the best way to avoid foreclosure is to sell your home. The best way to do this is to listit the traditional way. Unfortunately, falling real estate values have taken that option away frommany people whose mortgages are bigger than the market value of the property. If that’s the casefor you, there are two key options:Short Sale: This is when the bank agrees to let a homeowner sell the home for less than they oweon the mortgage. The catch is that, as you can imagine, lenders aren’t thrilled about the idea oftaking less than what’s owed to them, and it’s up to the lender to decide whether allowing a shortsale is in their best interest. This option may not be as damaging to the borrower’s credit as aforeclosure, but that’s only true if the creditor doesn’t report the debt reduction to credit reportingagencies.Deed in Lieu of Foreclosure: In some cases, a lender will allow a struggling homeowner to signtheir deed over to the bank instead of suffering a foreclosure. In this case, the borrower essentiallyturns the home over to the lender, who can then sell the home to recoup what they’re owed.Not that both deed in lieu of foreclosure and short sale can have tax implications. Therefore,homeowners should consult with an HUD-certified housing counselor as well as a tax professionalto determine the full implications of this move.
  7. 7. Six Ways To Avoid Foreclosure When YouCan’t Afford Your Mortgage Loan 5. Declare Bankruptcy Bankruptcy is no picnic. It’ll destroy your credit and make it hard for you to borrow any money from anyone for many years. Plus, depending on what type of job you hold, a personal bankruptcy can even be a bad career move. That said, in a Chapter 13 bankruptcy it is possible for owners to keep their homes, but only if they have a solid plan to repay at least some of their debts. Unlike Chapter 7 bankruptcy, Chapter 13 requires that borrowers make an attempt to repay some of what they owe before the slate is wiped clean.
  8. 8. Six Ways To Avoid Foreclosure When YouCan’t Afford Your Mortgage Loan 6. Walk Away During the height of the foreclosure crisis, lenders faced a phenomenon they came to refer to as “jingle mail.” Owners who could no longer make their mortgage payments and had little or no equity in the property would send their keys to the lender and walk away from their homes. For those who are upside down in their mortgage and who’ve been unable to work something out with the lender, allowing a foreclosure to happen may be the only choice.
  9. 9. Six Ways To Avoid Foreclosure When You Can’t Afford Your Mortgage LoanIn recent years, many borrowers in default have managed to stay in their homes formonths or even years without making payments. That’s because completing aforeclosure takes more than a year, on average, in the U.S. Plus, if borrowers chooseto fight their eviction in court, they may be able to stay even longer while the caseworks its way through the system. Some people will argue that this just isn’t fair, whileothers feel it’s the only choice they have.
  10. 10. Six Ways To Avoid Foreclosure When You Can’t Afford Your Mortgage Loan For Ways to stop home foreclosure on your home visit http://gofightforeclosure.com/Get a Copy Of Our Free Report: “The Untold Truths Of The Dirty Business Of Foreclosure” at http://gofightforeclosure.com/2/

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