Tips for Avoiding Foreclosure
Are you having challenges with making your mortgage payments? Have you received a letter from your lender asking you to contact them?
Don't ignore the letters from your lender
Contact your lender immediately
Contact a HUD-approved housing counseling agency
If you are unable to make your mortgage payment:
1. Don't ignore the pink elephant.
The further behind you become, the harder it will be to catch up your loan and the more likely you will lose your home.
2. Contact your lender as soon as you recognize a problem making your mortgage payment.
Lenders do not want your home. They have options to help borrowers through difficult financial times but you must contact them.
3. Open and respond to all mail from your lender.
The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notices of pending legal action.
4. Know your mortgage rights.
Find your loan documents and read them so you know what your lender may do if you can't make your payments. Learn about the foreclosure laws and timeframes in your state (as every state is different) by contacting the State Government Housing Office.
5. Understand foreclosure prevention options.
Valuable information about foreclosure prevention (also called loss mitigation) options can be found online.
6. Contact a HUD-approved housing counselor.
The U.S. Department of Housing and Urban Development (HUD) funds free or very low-cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender, if you need this assistance. Find a HUD-approved housing counselor near you or call 205-251-1572.
7. Prioritize your spending.
After healthcare, keeping your house should be your first priority. Review your finances and see where you can reduce spending in order to make your mortgage payment. Look for optional expenses--cable TV, memberships, entertainment--that you can cut out. Do you really need it? Delay payments on credit cards and other "unsecured" debt until you have paid your mortgage.
8. Use your assets.
Do you have assets--a second car, jewelry, a whole life insurance policy--that you can sell for cash to help reinstate your loan? Can anyone in your household get an extra job to bring in additional income? Even if these efforts don't significantly increase your available cash or your income, they demonstrate to your lender that you are willing to make sacrifices to keep your home.
9. Avoid foreclosure prevention companies.
You don't need to pay fees for foreclosure prevention help--use that money to pay the mortgage instead. Many for-profit companies will contact you promising to negotiate with your lender. While these may be legitimate businesses, they will charge you a hefty fee (often two or three month's mortgage payment) for information and services your lender or a HUD-approved housing counselor will provide free if you contact them.
10. Don't lose your house to foreclosure recovery scams!
If any firm claims they can stop your foreclosure immediately and if you sign a document appointing them to act on your behalf, you may well be signing over the title to your property and becoming a renter in your own home! Never sign a legal document without reading and understanding all the terms and getting professional advice from an attorney, a trusted real estate professional or a HUD-approved housing counselor at 205-251-1572.
11. Are you unemployed and are receiving unemployment benefits are eligible for unemployment benefits?If you are having financial challenges due to job loss, underemployment, higher mortgage payments or other reasons, you are not alone! Apply for a loan modification or utilize rescue funds at www.hardesthitalabama.gov. Several alternatives are available to save your home and save you hundreds of dollars!
If your primary residence has been foreclosed on between Jan 1, 2009-Dec 31, 2010 you may be eligible for a Independent Foreclosure review. For further information call us at 205-251-1572 to schedule an appointment to meet with a HUD certified housing counselor.
Posted on Fri, April 6, 2012
by Karin Park