When you are facing foreclosure on your home, it can feel like an overwhelming and hopeless situation. You may worry about becoming homeless or being unable to find a new place to live. You may also be concerned about what will happen with your credit rating if the home is foreclosed on. Fortunately, there are things that you can do to prevent foreclosure and get back on track with your mortgage lender. Even if you have decided that foreclosure is the best option for you and your current financial situation, there are steps that you can take to make the process easier. Knowing what kind of assistance programs or bill relief programs might help keep you in your home before it’s sold at auction will give you an advantage in dealing with your mortgage lender.

1. Refinancing Your Loan to Get Better Terms

If you are facing foreclosure, you may want to consider refinancing your loan. Refinancing means that you will be able to pay off your existing mortgage and refinance a new one with a lower interest rate and better terms. You may also want to look at other options, such as refinancing into another home loan or renting instead of selling your house.

2. Reduce Your Monthly Payments

A common misconception is that if you sell your home, you will be able to afford the payments on a new mortgage with a lower interest rate. This is not always the case and you must know what it will cost for you to pay for the mortgage on your new home. It’s also important to take the time to read the fine print in any offer from the lender before signing anything without getting legal advice first. If there are penalties in place if you don’t meet certain things like meeting certain minimum payments, then it could be more expensive than simply keeping up with current payments and avoiding foreclosure.

Another option is using a second mortgage or HELOC to pay for some of your monthly expenses until you are ready to buy another house again or until your current loan balance is paid off completely. You may want to explore this option, especially if you have existing debt obligations that need to be paid first before buying another house or refinancing into another loan product.

3. Get Help With Your Bankruptcy Case

Bankruptcy can help many homeowners avoid foreclosure by protecting them from their creditors while they reorganize their financial affairs. If you are considering bankruptcy, you should consult with a local bankruptcy attorney to learn if it is the best option for you and your current financial situation. If you do go through with bankruptcy, you must remember that this will not necessarily stop foreclosure proceedings. It will only delay them while your case is in court and try to get a more favorable outcome for your financial situation.

4. Enter Into a Forbearance Agreement

You may be able to enter into a forbearance agreement with your mortgage lender. This type of agreement will allow you to stop making payments and avoid foreclosure. However, there are some conditions that you will need to meet for you to receive this type of assistance. You will need to request a forbearance agreement from your mortgage lender before the loan is sold at auction. The lender can require that you complete certain steps before the sale of the home, such as paying back all outstanding amounts on the loan or making a down payment on the home or property that is going up for auction.

5. Loan Modification

Homeowners can apply for a loan modification if they meet specific requirements and requirements that the lender must follow to approve them. If you are facing foreclosure, it is important that you contact an attorney right away or as soon as possible. An attorney can guide you through these steps and help protect your rights while helping to get back on track with your mortgage lender. Foreclosure defense attorneys have proven that there are many benefits of this program including, restating your loan and relief from taxes, receiver fees, attorney fees, and additional costs that may be added to your old loan and first mortgage.

Conclusion

While identifying your problem and its causes can be very difficult, the sooner you take action to protect your rights, the better off you will be. If you are unable to come up with sufficient funds to prevent foreclosure, contact an attorney immediately. You must act fast and seek a foreclosure action as soon as possible.

Guest Contributor: Hannah Boothe