Foreclosure: Three Things
Every Homeowner Should Know
The one thing you don't want to do when you are in foreclosure is to avoid your lender. If you tell them the personal and financial situation that has caused you to be late or miss a few payments and how you plan to eventually pay back what you owe, they may decide to stop the foreclosure.
There a number of ways that your lender can help you
avoid foreclosure and prevent ruining your credit rating in the process. We will look at three different options you may have. Either you can get forbearance, a loan modification or a deed in lieu of foreclosure. Each option has different ramifications so it's important to think each through. Sometimes you just have to accept what the lender offers, but it still helps to know what you are getting into.
In forbearance, lenders give you the opportunity to pay back what you missed. You are expected to do so within a specified time. If your financial difficult is only temporary, then this is the best option for saving your home and maintaining your credit rating.
loan modification, the lender will agree to change the terms of the loan to make it easier for you to pay off your mortgage. They may lower your rate and then extend the loan so you are making smaller more manageable month payments. Of course, what you missed or owe will be included in the total payment.
Deed in lieu of foreclosure....
In a deed in lieu of foreclosure you deed your home to the lender. You lender becomes the new owner and will end the foreclosure. This is the last friendly resort. Usually, lenders will want for you to try selling your property first before considering this option.
Now that you know you may have a few options other than foreclosure or worst, declaring bankruptcy, you should give your lender a call and tell them your situation while it's not too late.
Copyright (c) Jackson Chan
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