Are you falling behind on your mortgage payments? Are you at risk of losing your home because that pesky arm has made your payments impossible?
There IS hope for people out that who are at risk of losing their home. If you're worried about foreclosure, here's a few important things to do to help you avoid foreclosure.
1. Don't Ignore the Problem
If you find that you are unable to make your payments you need to approach the problem in a proactive manner. Avoiding the issue until the bank starts calling is NOT the best way to deal with the situation. Call your lender immediately and discuss with them potential options and see if they have a program to assist you.
2. Open and Respond to all mail
Lenders would rather help bring you up to date than take your house, but they have no way of knowing your intent if there is no dialog between all parties.
3. Research your Options
Visit Hope Now for options on credit counselors and loss mitigation specialists who specialize in help people avoid foreclosure. HOPE NOW is a government sponsored organization designed to help people survive the current credit crunch.
4. Consider Adjusting your Spending Habits
Cable TV is NOT a necessity, and if you're trying to make bills work, you may want to consider cutting down on luxury spending. If you are also trying to pay on unsecured credit card debt, you may need to decide which bills get paid first. Mortgage Payments and Insurance should typically be the most important bills you have.
5. Avoid Foreclosure Scams
There's a lot of companies out there doing very unsavory deeds, preying on desperate homeowners. Paying someone to help you avoid foreclosure does make sense; that money should go towards the mortgage. Be wary if someone claims to be able to solve your foreclosure problems quickly and easily, and don't sign documents unless a lawyer or real estate professional has gone over the documents with you. Many people have unknowingly signed over the deeds to their houses to companies claiming to instantly solve foreclosure problems!
6. Be Prepared to Ask for Assistance
If you do find you need to sell your home, don't wait until 2 weeks before the foreclosure is complete. The average market time is 100+ days in most markets provided the house is well priced. If you want to sell more quickly, you will need to discount the price of the home accordingly. Now is not the time to FSBO, make sure you get in touch with a professional who is EXPERIENCED in helping homeowners avoid Foreclosure
7. If you enter pre-foreclosure, expect a 100-150 point drop in your credit score. If you are foreclosed on, that number can climb as high as 250 points, making purchasing another home nearly impossible.
There is help out there, you just need to be ready to ask. I speak with homeowners daily in regards to situations like this, and I'm always willing to provide as much information and advice as I can, free of charge, to help people keep their homes.
~Jonathan Benya
Century 21 New Millennium
301-653-8116
Hi! I work at ____________.com a foreclosures site. Very informative and helpful article. In most cases, troubled homeowners would have wanted to negotiate with their lender but were probably pressured to pay. Because of the stigma attached to foreclosures, the homeowners would rather wait for the foreclosures proceedings than seek advise or help. These days, because of the crisis people are made more aware that there can be help if people just seek it out. There are many forms of assistance to choose from and while not all may be applicable to the troubled homeowners, at least they have options unlike before when delinquent owners felt like being pushed to the wall.
Posted by: Catherine | December 10, 2007 at 05:03 AM