Avoiding foreclosure

Many unfortunate people go in to foreclosure and lose their homes without ever looking at all the other options they might have. In several cases, the debtor has quite a few options to avoid foreclosure and regain control of their homes.

Remember that the lender does not want to own your property, they want your loan to be current and repaid in time. So instead of ignoring the problem and avoiding it until it is too late, go talk to your lender. Lenders often have various options in place for borrowers who are going through a financial crisis.

Even if you are far into the defaulters’ list, you can still sit down and talk with your lender. You can get an extension if you can prove that you have enough income to make the loan current again. This will be calculated against your expenditures and it is similar to when you are applying for a fresh loan.

Read through your loan papers carefully and get to know the mortgage terms before the legal notices start flying. You must be aware of the steps that your lender may take against you if you do not make the regular payments.

Always read the letters sent by the lender. The very first notice will often contain valuable information regarding how you can avoid a foreclosure situation. Do no ignore any mail from your lender because subsequent mails may have official notices of legal action against you. A court will not consider your case on the grounds that you failed to respond to a written communication. Hence, make sure you read the mails and respond to them.

Look at all the possible areas where you can decrease your spending. Give up luxuries like cable TV, club memberships, needless shopping, etc. Cut down on every possible cost and delay payments on ‘unsecured’ loans like credit card bills. You home should be your primary concern right after healthcare.

Use your assets to raise money for the mortgage. You can do this by selling things like old cars, jewelry, etc.  Once the roof over your head is secure, getting these back would be much easier.
There are a innumerable foreclosure scams all around. There are many fraudulent companies who promise immediate relief from foreclosure and many such things only if you sign a document. If you sign without reading first, you might be giving away your claim to the house and becoming a tenant in your own home!

Do not pay a company to get you out of debt either because they will charge you money for information that a government agency or your lender will provide you for free. It is always a good idea to use whatever extra money you have to make your mortgage payments.

Before taking any important steps, it would be wise to talk to a real estate lawyer or a government certified counselor. These people are trained to help you with foreclosure situations and will be able to give you sound advice based on your unique situation.