Foreclosure doesn’t happen overnight.
Sometimes financial situations change for reasons like a loss of job, mortgage payment increase, divorce, or medical expenses. You may have missed a payment, or simply be worried you might miss a payment.
There are steps you can take to avoid foreclosure happening.
1. First and foremost -- Do not ignore the problem.
If you get further and further behind with repayments it becomes increasingly more difficult to reinstate your loan.
2. Contact your lender immediately.
They don’t want to take your house away. They have options to that help borrowers through financial difficulties.
3. Don’t ignore correspondence from your lender.
Open letters and respond -- it will never be an accepted reason in a foreclosure court that you didn’t open your mail.
The initial notices you will receive will contain helpful information on how to handle your difficulty.
4. Know your mortgage rights.
Often, we quickly skim documents. If you did this with your loan documents, we strongly recommend that you find them and read them carefully. You need to know exactly what your lender may do if you can’t, or haven’t, made payments.
Foreclosure laws and time frames vary state to state -- you can find this information by contacting the State Government Housing Office or speaking to a specialist attorney.
5. Prioritize your spending.
This may seem obvious, but is very important nonetheless. Review your finances carefully and determine what could be considered optional payments and luxuries.
After your healthcare, keeping your house will be your first priority. Consider suspending memberships, TV, entertainment and delay payments on credit cards and other “unsecured” debt until you have paid your mortgage.
6. Use your assets.
Think about what assets you have that could prove useful. Do you have a second car, jewelry, something valuable, but not essential -- that you can sell for cash to help reinstate your loan?
Can anyone in your household get an extra job for some additional income?
Remember: even if these efforts don’t significantly increase your income or available cash, they demonstrate to your lender that you are willing to make sacrifices to keep your home.
7. Be very wary of foreclosure recovery scams.
A firm may claim they can stop your foreclosure immediately and have you sign a document which appoints them to act on your behalf; you could be signing over the title to your property rendering you as a renter in your own home.
Never sign a legal document without carefully reading and understanding all of the terms. It is always recommended to seek professional advice from an attorney or a real estate professional.
If there is anything you aren’t sure about -- you can speak to one of our real estate specialists who have a wealth of experience in dealing with and preventing foreclosure.
Book a free consultation now. Please click below.