Worried About Foreclosure? Here’s What You Can Do

Foreclosure

You might be worried about foreclosure if you struggle to make your mortgage payments. Foreclosure is a process that allows your lender to take your home if you can’t make your payments. But there are ways to avoid foreclosure. You can negotiate a loan modification with your lender, which will change the terms of your loan and make it more affordable. You can also refinance your loan, which will lower your monthly payments.

You can take action RIGHT NOW to prevent foreclosure on your house if you have any indication that your financial situation may deteriorate. You must move swiftly to deal with something of this size. Turning things around should be completed on time. You may be facing the following:

  • The loss of a job.
  • Cuts in hours or overtime pay.
  • Retirement.
  • Illness, injury, or the death of a family member.
  • Divorce or separation.

If your family is going through any of these changes and you’re having trouble paying your bills, now is the time to look at what you owe and what you earn, cut back on unnecessary spending, and ask for help if you’re still unable to meet your financial obligations. 

You can protect your family from the threat of losing your home if you act quickly. Here are some steps you should take right now to protect your home from future risks and eliminate the possibility of foreclosure.

Remember. Now is the time to take action. The longer you delay, the worse the situation will become. 

Contact Your Mortgage Company Now

When they have problems with their finances, many people avoid phoning their lenders. The vast majority of us are either too ashamed to talk about our financial woes to other people or mistakenly feel that once our creditors get aware of our predicament, they will move quickly to start the foreclosure or collection process.

Lenders have a vested interest in seeing borrowers remain in their houses. Lenders, mortgage insurers, and investors incur high costs when a foreclosure occurs.

Lenders must diligently handle financially distressed customers for HUD, FHA, commercial mortgage insurance agencies, and investors like Freddie Mac and Fannie Mae. 

Lenders typically offer to restructure choices that can assist borrowers in remaining in their homes. However, you should consider these possibilities only if you are only one or two payments behind on your loan. The further you need to catch up on your payments, the fewer options you will have available. Do not make the mistake of assuming that your difficulties will resolve themselves immediately.

Being too optimistic might be a waste of time; therefore, try to avoid being so. Contact your mortgage lender immediately if you can’t pay. While there is no assurance that any specific form of relief will be granted, most loan providers are eager to investigate any and all possibilities. To assist you, lenders often require the following:

  • Your loan account number.
  • A brief explanation of your circumstances.
  • Recent proof of income, such as pay stubs or benefit statements from Social Security, disability, unemployment, retirement, or public assistance. If you are self-employed, you should have a copy of your tax returns or a profit-and-loss statement for the current year ready for reference.
  • List of household expenses.

Prepare yourself for more than one talk over the phone with your lender. In most cases, your lender will send you what is known as a “loan workout” package. The information, forms, and instructions are all contained within one package.

You must complete the paperwork and get it back to your lender as soon as possible to be eligible for assistance. Before the lender discusses a solution with you, they will first look over the finished package and make any necessary decisions. Call Today! The sooner you give us a call, the quicker we can send someone to assist you.

Don’t Ignore Mail From Your Lender

Soon after you cease paying payments, your lender will attempt to contact you by letter or phone if you have yet to contact them first. 

You must answer the people who have offered assistance by phone or letter. Your lender will foreclose unless they hear from you. This will result in a significant increase in the overall cost of bringing your loan current. 

Speak With a Housing Counseling Agency In Your Area

If you do not feel comfortable discussing this with your lender, you should make an appointment with a housing counselor as soon as possible by calling a housing counseling agency that is approved by the HUD.

A counselor will assist you in evaluating your current financial status, identifying the options open to you, and helping you negotiate with your lender. 

In addition, the counselor can call the lender to discuss a workout plan with you or on your behalf, depending on what works best for you. You can safeguard yourself against potential credit issues in the future by consulting a counselor before your mortgage payments go too far behind schedule.

A good counselor can help you create a monthly budget that allows you to pay your mortgage and other bills. 

Your individual financial plan will clarify how much money you have to make monthly mortgage payments. Using this research, you and your lender will assess whether or not a modified payment plan that includes reduced payments or a delayed payment schedule could benefit you.

Also, a counselor will have information on services, resources, and available programs in your local area. These services, resources, and programs may provide additional financial, legal, medical, or other types of assistance you may require. A counselor will have this information.

Conclusion

There are numerous options available to homeowners struggling to keep their homes. If you’re having trouble paying your mortgage, please ask for help. Contact your lender as soon as you notice a problem making payments. You can change the terms of your loan or get help from a housing counseling service. Don’t wait until it’s too late to act.

 

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