Stop Foreclosure Options
There are many options today for homeowners who are facing foreclosure to stop foreclosure proceedings against their home. The most important thing is to start seeking help early on before you get too far behind on your mortgage payments. Talk to your lender and explain your financial hardship. Lenders want to help their customers keep their homes. It may also be a good idea to consult with a real estate foreclosure defense attorney, a short sale company or a certified HUD home counselor to find out what options are best for your financial situation. HomeBackers are expert short sale negotiators that can assist you with your options and negotiate a resolution with your lender. Their telephone number is 937-754-1111, and their website address is http://www.ImBehindOnMyHousePayment.com
The following is an overview of stop foreclosure options that are available to distressed homeowners:
Mortgage Modification
A mortgage modification is a modification of your existing mortgage. The purpose is to lower your payment by reducing your interest rate and adding the arrearages to the back end of your loan. Sometimes the lender will also reduce the principal balance. Mortgage modifications take at least a few months to get approved so be patient. You must show you have sufficient income to make the new mortgage payment. So if you are unemployed, a mortgage modification may not be the best option for you.
Refinancing
For those homeowners who have some equity in their home, refinancing is a good option if you currently have a variable interest rate loan. By reducing your current interest rate at least 2%, you will substantially lower your monthly mortgage payment. There are fees associated with refinancing so check around before you choose a loan product. Under the Home Affordable Refinance Program, you may qualify to refinance. Highlights of the Program are referenced below:
The Home Affordable Refinance Program
• Homeowners with debt that exceeds their home value by 5% are eligible for refinancing.
• No prepayment penalties either.
• Loans must be backed by Fannie Mae or Freddie Mac.
Homeowners Who are Not Eligible
• Homeowners whose home values declined severely under 5%.
Homeowners with Jumbo mortgages, which exceed $417,000 are not eligible.
Deed in Lieu of Foreclosure
A deed in lieu of foreclosure is when you simply sign over the deed to the lender, walk away not owing any money and hand the keys over.
Short Sale
In a short sale, you must obtain your lender’s approval prior to selling your home. The lender writes off the remaining loan balance. Be sure to negotiate that the lender cannot go after you for a deficiency judgment. Some states allow the lender to sue the borrower for a deficiency judgment after the sale closes. A deficiency judgment is the difference between what you owe your lender on your mortgage and the sale proceeds. Short sales take about 60-90 days or longer to get approval. It is a great way to get your home sold to avoid a foreclosure on your credit if you have no equity in your home and can’t afford your house payment.
Sell Your Home
Selling your home is an option if you have equity.
Reinstatement
The lender reinstates your loan when you pay all amounts that are in arrears including any fees and costs.
Bankruptcy
Bankruptcy has serious consequences and should be used as a last option to save your home from foreclosure. It is recommended that you consult with a bankruptcy attorney. You may be able to file either a Chapter 13 or Chapter 7. The court automatically issues an order for relief staying or stopping your creditors from any collection activities. This includes postponing any foreclosure sale during the bankruptcy proceedings.
It is important to under the different bankruptcy laws. Chapter 7 wipes out all your debts. In a Chapter 13, you can keep your home, and you agree to pay your creditors via a payment plan.
Don’t despair if you are facing foreclosure, you do have options to save your home. Time is of the essence so act early on before matters get worse. HomeBackers is a Real Estate Solutions Company and are available to assist you. Their telephone number is 937-754-1111, and their website address is http://www.ImBehindOnMyHousePayment.com.
