Truth About Foreclosure
Help for Distressed Homeowners
Here's the honest truth about foreclosure help for distressed homeowners. Lenders want your mortgage payments, not your home. Mortgage companies are not in the business of owning homes. This is great news for home owners today. It's also why mortgage lenders are willing to help you avoid foreclosure.
This is one time you shouldn't try to tough it out on your own. It's too serious. When it comes to being late on mortgage payments, there's no time to spare.
So contact your lender for foreclosure help at once. After all, there's more assistance for avoiding foreclosure than ever before. Update: Special Edition of Making Home Affordable Program options.
10 Foreclosure Alternatives - Ask Your Lender
- Hope Now - A voluntary mortgage industry alliance assisting home owners in distress, HOPE NOW counsels American home owners to help prevent foreclosure. HOPE Now reports 5 million loan modifications from its inception in 2007 through November, 2011. Homeowners who are concerned that they will not be able to continue making monthly house payments can call the Homeowners HOPE Hotline - 888-995-HOPE.
- Reinstatement - This requires a lump sum to bring delinquent mortgage payments current. If a lump sum payment works for you, great! But let's face it. If you actually have saved enough money to repay missed mortgage payments, you probably would not be in need of foreclosure help. Right? So let's explore some other options.
- Special Forbearance - If you are experiencing temporary circumstances that cause you to get behind on mortgage payments, your lender may give you a short period of time with reduced payments or no payments at all. Be prepared to present an eventual solution to resuming regular mortgage payments. Lender will want to know why your financial problems will be short-term. Forbearances won't last forever.
- Mortgage Modification A - Another solution to avoiding foreclosure is to ask your lender to extend the number of years to repay your mortgage. Even though it will take you longer to pay off your mortgage, loan mods are a great alternative to foreclosure.
- Mortgage Modification B - Here your lender actually refinances your home. The terms might not be perfect but if the refinance modification lowers your payment and saves your home, explore the options. And be smart. Like Jerry learned, know when to stop shopping and accept the lender's offer to stop mortgage foreclosure. See what other Readers like you ask Kate about loan modification.
- Short-Pay - If you're attempting to sell your house with an appraised value less than the mortgaged amount, ask about a short-pay. This means your lender agrees to accept less than full payment of your mortgage. You'll be able to proceed with your sale. Your lender might even be willing to give you a certain amount of time without mortgage payments while you sell your home.
- Deed in Lieu of Foreclosure -- This resembles a voluntary repossession. Deed in Lieu of Foreclosure should be your last resort. Most lenders do not want your house back and are willing to work with you before it comes to this.
- FHA Loans - For those with FHA mortgage loans, the FHA-Insurance fund might pay some of delinquent mortgage payments to lenders. Certain restrictions apply. After the lump sum is paid by FHA, you must be able to resume the mortgage payments. U.S. Department of Housing and Urban Development will place a lien on your home for repayment of the lump sum when you refinance or sell your home.
- VA Loans - The U.S. Department of Veterans Affairs offers foreclosure help to VA home owners.
- FHASecure - Cancelled. This was a foreclosure help alternative for home owners who did NOT have an FHA loan. The current mortgage had to be an adjustable rate mortgage with a payment that was resetting. Many of these were subprime mortgages.
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