Your Options to Stop Foreclosure on Your Home
Because the current economy hasn’t yet stabilized itself, it is normal for people to face difficulty with their finances. In fact, there are some people who have resorted to loaning money from companies. For those who are unable to pay the loan yet, they stand the chance of facing home foreclosure. If you are among these people, it is best that you know how you can stop foreclosure before it’s too late.
While there are many people who think home foreclosure is inevitable, it is not always the case. Usually, people try to evade talking to their lender because they do not want to discuss a hopeless case with them. However, if you are dealing with a home foreclosure, it is best that you talk to your lender. Once your lender does not see you making any attempts to stop foreclosure, you will be given a notice of default. So if you still wish to save your property, it is best that you discuss your options given by the US Federal Trade Commission:
When you choose a repayment plan, your lender will give you a fixed duration of period so you can repay your past-due amount along with a portion of the regular payment. This is an option that’s best if you simply missed a few payments.
This is one option that will let you pay the whole past-due amount as well as any late fees or penalties, on an agreed-upon date. You can opt for this option once you have temporary payment difficulties.
Another option you may want to consider is forbearance, which is best if your income has been temporarily reduced. Through this option, your lender will suspend or reduce your mortgage payments for a duration of time. Afterwards, you will need to either add partial payments for several months or make regular payments and then pay a lump sum amount.
To make your payments more manageable, your lender may agree to make permanent changes on one or more terms on your mortgage contract including extending loan term, reducing interest rate, or adding missed payments to loan balance. Under the Mortgage Forgiveness Debt Relief Act of 2007, it is also possible for your lender to reduce your owed amount through cancelling or forgiving a portion of the debt. Contrary to forbearance, this option is best if you have a long-term income reduction.
If worse comes to worst, you can opt to file for bankruptcy or sell your home. In order to find the best option to stop foreclosure on your property, it is best you talk with your lender or hire a company that provides assistance in such scenarios.