Financial problems have prevented a lot of people from paying their mortgage obligations for a number of months, even years. This delinquency in paying mortgage loans often resulted in lending institutions, such as banks from taking full authority of the property, and this legal process is dubbed as a foreclosure. It is a painful sight to see their beloved homes gone after years of hard work and religiously paying obligations. In some instances, they run out of options and decided to sell their house just to get a portion of what they paid.
While foreclosure is a tough life chapter, there are actually lots of ways to stop or avoid a foreclosure. In an article published by Money Crashers, there are over 676 thousand homes that went into foreclosure, roughly that’s 1 of every 200 homes in the country. Read the article below to learn more about avoiding foreclosure.
How to Stop & Avoid Foreclosure on Your Home
Image Source: Money Crashers
In 2017, more than 676,500 American homes went into foreclosure, according to Attom Data Solutions. That’s roughly 1 out of every 200 homes in the country. This is better than the peak rate in 2010 when more than 2 out of every 100 homes were in foreclosure, but it still represents hundreds of thousands of people being forced out of their homes because they couldn’t meet their mortgage payments.
Homeowners can end up in this situation for many different reasons. Some lose their jobs and can no longer make ends meet. For others, a health crisis leaves them with hefty medical bills that eat up their available funds. And some simply make the mistake of buying more house than they can afford, so that even a small change in their finances is enough to put the payments out of their reach.
Raising Extra Cash
If you haven’t fallen behind on your mortgage payments by more than a month or two, you still have a chance to get back on track. If you can manage to raise enough extra cash, you can make up the missed payments and save your home from foreclosure.
Here are some ways to raise money in a hurry.
Slash Your Expenses
Start by cutting out all the extras in your budget, if you haven’t already. Cancel your cable TV, scale back to a cheaper cell phone plan, drop your gym membership, stop drinking bottled water, and quit going out to eat, even if it’s just for coffee in the morning.
Refinancing
Some people wind up in trouble because of adjustable rate mortgages that have a low, manageable payment for the first few years, then suddenly jump up to a level that’s out of reach. Some of the worst offenders are interest-only loans, which become much more expensive when you have to start paying principal as well as interest. Other people have fixed-rate mortgages, but the interest rate is very high – perhaps because they had poor credit, or perhaps because the rates just happened to be high at the time. See full post here…
Foreclosure reflects your capacity to settle monthly mortgage obligations. That is increasing your income streams help in avoiding unsettled balances leading to foreclosure. Another good option is thru refinancing, allowing you to lower your monthly payment to manageable levels. These and more could help you stop and avoid home foreclosure.
Elizabeth Weintraub of The Balance gives us the best ways to stop a foreclosure. Check out the article below to learn more.
Best Ways to Stop a Foreclosure
Photo Credits: The Balance
Homeowners who are hoping to stop foreclosure often dread dealing with the facts that got them to the place of being in foreclosure. Dealing with those facts can be depressing. If they think back to when they first bought that home, losing the home was probably the furthest thing from their mind. Few homeowners actually plan to go into foreclosure.
Reasons for a Pending Foreclosure
Apart from those who knowingly participate in mortgage fraud — with the intention of never making a single payment — most homeowners face sudden extenuating circumstances that force them to stop making timely mortgage payments. Here are a few of those reasons:
Job loss/unexpected unemployment
Sudden illness or medical emergency
Death in the family
Divorce/loss of a second income
Excessive debt obligations
Ways to Stop a Foreclosure
The best way to stop a foreclosure in California, for example, is to prevent the filing of a Notice of Default. We mention this state because 35 million people live in California and California is the land of real estate religion. Lenders do not want to foreclose but will file a Notice of Default to protect their interests, if necessary. If you know you are unlikely to meet your mortgage obligation, the first thing you should do is call your lender.
Don’t put it off, be embarrassed or ignore letters from your lender because those responses will make the situation worse, not better. Depending on your particular situation and hardship circumstances, here are some loan modification options your lender might propose to you:
Time to make up your payments: Lenders might agree to wait before taking legal action against you and let you work out a repayment plan that is affordable for you. This is called forbearance.
Forgiving a payment: If you can agree on a way that you will be current after missing a payment or two (without the means to pay it back), the lender might give you a break and waive your obligation. This is called debt forgiveness, and it rarely happens.
Spread out the missed payments over a longer term: For example, if your payment is, say, $1,200 a month, the lender might let you add $100 a month to each payment for a year until you are caught up. This is called a repayment plan.
Options After a Notice of Default
When the lender files a Notice of Default, your options are limited. That is why it is better for you to call your lender before falling behind on your payments because lenders are often reluctant to work out repayment schedules after foreclosure proceedings have been commenced. Click here to read the rest of this post…
The best way to avoid foreclosure is to know the reasons. That way you’ll know what to avoid and how to completely avoid them. Also, do research as to how foreclosure works in the country you are into. Always be mindful of your obligations.
In case you’re already facing foreclosure, here are the things you can actually do to slow down the process according to Tara Mastroeni in her article at Forbes.com. More information about the topic below.
Facing Foreclosure? Here Are 5 Things You Can Do To Slow Down The Process
Image Source: Shutterstock
Going into foreclosure is undoubtedly scary. However, receiving a Notice of Delinquency in the mail doesn’t automatically mean that you’re going to lose your home. There are things that you can do to slow down the process and get back on track or, at the very least, to leave your financial record in the best shape possible. Keep reading to learn more about your best options.
What is foreclosure?
By law, signing a mortgage means that you’ve agreed to pay the lender back, in full, for the loan and you’ve agreed to do it according to their terms. When you stop making payments, you’ve essentially breached that contract. As a result, the lender has the right to take back your home and try to recoup the investment. The process of them repossessing your home is known as foreclosure.
If you’re a few days late on your mortgage payment this month, don’t worry. The bank won’t come for your house right away. Most lending institutions offer a 15-day grace period that may or may not have a late fee attached. It’s only after you haven’t paid your mortgage for a period of 90 days that foreclosure proceedings will start. From there, the process can take anywhere from two to twelve months, depending on where you live. Since the process is so long, you have time to make changes and to hopefully remain in your home.
How to slow down the process:
Educate yourself
When you’re nearing foreclosure, the first thing you’ll want to do is to educate yourself on what’s happening. Take a deep breath and read over everything you’ve received from the lender, including your mortgage itself. Many initial notices of late payment will contain information on foreclosure prevention options. Later mail might contain important notices about the foreclosure process and pending legal action. No matter what it says, it’s better to be informed.
Call your lender
Next, get in contact with your lender as soon as possible. The reality is that foreclosure is a very time-consuming and costly process. Most lenders would rather work with you to find a solution than actually repossess your home. Honest communication and a willingness to work together will go a long way towards helping you get back on steady ground. Learn more here…
As mentioned, foreclosure can be avoided by everyone, even those who are facing financial problems. They must have the discipline and open-mindedness to add additional income streams, do refinance among others. The process does not happen overnight, so you have the chance to settle your obligations before the banks take full authority over your property.
Foreclosure is a painful process, but could also be an opportunity for home buyers and investors to buy homes at a discount. There are lots of them in foreclosed listings. If you need some help in finding good deals at foreclosures, Dependable Homebuyers is the right person to seek help. They have years of experience in finding the best deals in a list of foreclosed properties. To know more, visit https://www.dependablehomebuyers.com and let’s get started.
