Avoid Foreclosures
Options to Consider to Avoid Mortgage Foreclosure
Facing a mortgage foreclosure can be a process that is dealt with in steps and at a steady pace. A homeowner may feel overwhelmed by the process of foreclosure, but understanding one's options to avoid mortgage foreclosure can be the first proactive step that helps a homeowner get through this process.
Creating a Repayment Plan - Creating a payment plan helps a homeowner reduce the monthly payments that he or she owes to a lender. Lenders are increasingly open to the option of restructuring the payments that a homeowner owes, and this option can help a homeowner keep his or her home. A loan modification can also result in a drastic reduction to the principle balance owed on a home, which then reduces the total number of payments that a homeowner must make to pay off a home.
Negotiating a Forbearance Plan - For homeowners who are in very difficult financial situations, a forbearance plan may be one favorable way to deal with the possibility of foreclosure. A forbearance plan involves the temporary suspension of payments or reduction of payments that are owed on a home. The payments are then increased later in the repayment process.
Taking Advantage of Government Programs - The government is constantly creating new programs that homeowners can use to avoid foreclosure, and homeowners should check with the U.S. Department of Housing and Urban Development for more information on these programs. The website can be found at http://portal.hud.gov/hudportal/HUD. One prgoram that is currently available to help homeowners avoid foreclosure is the Home Affordable Refinance Program. This program allows a homeowner to apply for financing through HARP if the value of one's home has drastically declined. If a person is unable to obtain financing for a home from other lenders, then this program will help a homeowner in that situation.
Claiming a Home in Redemption - Even if a home has been sold at a foreclosure sale, homeowners still have a last possible chance to repurchase their home. There is a period called "redemption" in which homeowners have the opportunity to pay an outstanding mortgage balance and any other associated costs.