I Can Prevent Foreclosure On My Home- But Do I Want To?
Has this happened to you or a friend or relative
?
Your banker is putting on the pressure. The calls keep coming and you try to avoid having to answer your phone. You have a sick feeling that you are destined to lose your home. Well, relax; it is not the end of the world. You CAN prevent foreclosure and regain your peace of mind. In just a minute, we'll explore some different ways that you can prevent foreclosure. We'll even explore the idea that you may be able to stop foreclosure after the process has begun. But first:
Have you made the decision that you really want to keep your home?
All across this nation, real estate prices have plunged. In many cases, homes are now worth only half of what they once were. If you now find that you are "upside down" on your home loan, (you owe more on the home than it is worth) perhaps you should ask yourself,
"Do I really want to stay in this property?"
If the answer is "No", you may wish to reflect upon doing either a short sale or a deed in lieu of foreclosure.
On the other hand, if you have even a small equity in the property and you would rather not uproot your family, it may very well be worth the effort to try to prevent foreclosure.
Break down Your Finances
The first task you should do is analyze your overall financial situation. Jot down a list of all expenditures. Which items on this list could you eliminate right now? Fewer restaurant meals, rent a movie instead of going to the theatre, or perhaps skip that morning Starbuck's? A willingness on your part to make some sacrifices will go a long way in convincing your mortgage lender to work with you.
Next, jot down every source of income for your family. Now list any personal property that you might quickly liquidate. If you are only coming up a few hundred dollars short on your budget each month then it is quite probable you can prevent foreclosure on your home. If, however, you find that you're hopelessly in debt then trying to stop foreclosure may not be the best answer.
You might be able to prevent foreclosure by earning a few extra dollars each week. There are many good work from home programs that could enable you to make a few hundred dollars each month. Be sure to do your homework, though, as there are also many "get-rich-quick" scams around. Look for part-time job openings near your home. This can save you a lot of time and commuting expense. If your home is important to you it would be well worth the extra effort to stop foreclosure by earning a little extra.
Dealing With Bankers
If your financial crisis is due to a set of temporary circumstances, you might be able to negotiate directly with your lender for a short-term repayment plan to bring your payments up to date. This involves making an additional catch-up payment each month for several months. While expensive in the short term, it is probably the fastest way to resolve the problem.
If your mortgage payments are now so high that you truly cannot afford your home any longer, you will need to bring the mortgage payments back to an affordable level by seeking a loan modification to resolve the problem, or qualify for a refinance loan with lower monthly payments. The other option is to downsize/downgrade to more affordable accomodations.
If you're still not entirely clear on what the best option is in your specific situation, for you to prevent foreclosure, you probably should speak to a loan modification specialist. Not only will they help you to brainstorm ideas, but typically their initial consultation is free.
There are also good resources available on our website, including "do it yourself" stop foreclosure handbooks that will provide you with the information you need to make these decisions.
Remember, it's important to take action quickly if you wish to prevent foreclosure. This includes communicating with your banker early on. The lender has a specific window of time during which they might work out a deal with you, before starting a foreclosure. You must act quickly in order to prevent foreclosure.
by: James Sopher
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