What Are My Options for Avoiding Foreclosure?
How to Avoid Foreclosure
Going up against foreclosure is a difficult burden to bear. The dream of homeownership turns into a financial nightmare. Before you give in to despair, understand that you still have options. There are many resources available to help, even when it feels like it’s too late. When you get help and learn your options, you can find ways to stave off foreclosure. Sometimes that means you get to keep your house, adjust your payments, and get back to life. Other times it might be more complicated.
For the most part, you have three options if you’re in danger of foreclosure: loan modification, bankruptcy, or selling your house. At Foreclosure Advocates, we can help you determine which path is right for you. Contact us today for a consultation to discuss your financial situation. You can learn more about the three different methods for avoiding foreclosure below.
Obtain a Loan Modification
If you can’t afford your mortgage payments, one of the first options you may want to explore is a loan modification. To put it simply, this is a renegotiation of the terms of your mortgage loan. It can change the total amount you owe. More importantly, it is intended to change your monthly payment. If you can have your loan modified to a more manageable amount, then you may be able to keep your house and avoid foreclosure.
Loan modifications ultimately require the lender to agree to the change. That’s not always an easy thing to make happen since lenders may lose money in this process. Your best bet for pursuing a loan modification is to contact financial resources. If you acquired your loan through an assistance program like the FHA, that same agency can help you make your case for a modification. Regardless, the worst that can happen if you ask for a modification is that you get denied. You won’t be any worse off for trying.
Declare Bankruptcy
When simpler options are unavailable, you can look into declaring bankruptcy. This is a more complicated procedure than getting a loan modification, and the consequences for you are more severe, but there are plenty of cases where bankruptcy will allow you to keep your house.
The biggest advantage of filing for bankruptcy is that it puts a temporary stay on all of your debts. Foreclosure cannot complete until after the bankruptcy is settled. That can buy you time to negotiate terms and work on alternative housing solutions.
Once the bankruptcy is completed, you will be subject to the ruling of the court. More often than not, foreclosures will continue at this point. This is why bankruptcy is often at its best if you use that extra time to work on a loan modification. If that isn’t an option, you have the duration of the bankruptcy process to explore all of your options.
Sell Your House
Believe it or not, selling your house is one of the most common ways to deal with foreclosure. In plenty of states, you are guaranteed a set amount of time to try to sell your house before a foreclosure is complete. If you can sell within this time, you can use the cash to settle your mortgage. Anything left over is yours to keep.
The trick is that you need to be able to complete a sale within the timeframe allotted. You can try to use bankruptcy to buy time if you need it. You can also look into faster means of selling the home. While a traditional sale through a realtor is a viable option, selling to a real estate investor will expedite the process. They typically pay cash, which lets you skip many of the most time-consuming steps in selling a house.
The thing to remember is that the house still belongs to you until the foreclosure completes. You can decide if and when you are willing to sell. So long as you understand the financial situation and time tables in front of you, you have a lot of options.
Contact Us to Discuss Your Options
No two foreclosures are the same. Each person is different. Each house is unique. Every set of conditions is separate from any other. It’s great that you’re looking ahead and trying to find solutions. Ultimately, you need more than you can glean from a few minutes of reading. You need an expert on your side.
That’s where our team at Foreclosure Advocates comes in. We can help you explore all of your options and ensure that you fully understand each one. We want you to have the best chance of walking out of this situation without life-altering financial fallout and with a roof over your head. Contact us so we can help.