Foreclosure is one of the biggest fears in America for homeowners, particularly those who took on mortgages that exceed what they can afford. To save your home from foreclosure you have to start considering your options as early in the process as possible, preferably before you’re late with a mortgage payment.
Contact Your Lender
Communication is one area in which homeowners often are not proactive enough. Your mortgage lender is far more likely to go through with foreclosure proceedings if they don’t hear from you. Giving them a call to explain your situation is a great first step toward saving your home from foreclosure. Again, you should make the call before you are late with a payment.
If there are specific circumstances surrounding the reason you can’t pay your mortgage, give your mortgage lender details. Explain any job loss, unexpected bills or other reasons and then give the lender a time span during which you’ll be able to rectify the problem. Believe it or not, your lender wants you to save your home from foreclosure.
Get Help
It is doubtful you will be able to save your home from foreclosure on your own. There are too many legal intricacies involved in the process, and you’ll be much better off with an attorney or debt management team in your corner. Ask family members or friends if they can help you with the fees for these professionals until you get back on your feet.
Attorneys in some states are required to commit a certain number of volunteer hours every year, so that might be an option to help save your home from foreclosure. Alternatively, you can try a free debt management service through government or charities. Don’t assume that you’re out of options.
However, you do need to be careful. You might be in a panic to save your home from foreclosure, but there are financial predators out there that will take your money and run. Don’t pay an attorney or debt management firm until you’ve vetted them through the Better Business Bureau and genuine references. Your local Housing and Urban Development office might be able to make legitimate referrals.
Put Your Mortgage First
There is a chance you can save your home from foreclosure by bringing your mortgage debt up to date. If you are paying other bills, such as credit cards and loans, before your mortgage, put your mortgage first. Again, a debt management service can help you prioritize your bills to make the most important payments on time.
Sell Your Home
Another option when you are trying to save your home from foreclosure is to sell your home as quickly as possible. If you’ve built substantial equity, you might come away from the deal with some money in your pocket to rent or buy a smaller house. Let your mortgage lender know that you are putting the home on the market to meet your debts.
In some cases, a mortgage lender will accept a short sale on a home that is bound for foreclosure. This means that the money generated from the sale is insufficient to meet the amount due on the mortgage. For the lender, this might be more profitable than going through the entire foreclosure process. You have to communicate with them for this to be an option.
Hundreds of homes enter foreclosure on a monthly basis in the United States, particularly on the heels of the housing downturn. However, there are ways to save a home from foreclosure, especially if you are proactive from the very beginning. Recognize you have a problem and find the best way to solve it as quickly as possible.
