In the event that you’ve missed several mortgage payments and you have not made proper communication to the lender, you could face foreclosure. If you find yourself in this situation, read on to learn more about what you can do.
If you have a potential buyer for your property, it would be a wise decision to consider selling it. With the proceeds from the cash sale, you can then clear on your mortgage dues and you get to earn the full market value for your home. Your leftover funds will support you as you plan your next move. Don’t go it alone, though. Consult your lender, especially when you’ve used the property as collateral.
If your financial turmoil is coming to an end and you can resume your mortgage payments, consider forbearance.
Forbearance is an agreement with the lender in which they agree to delay legal action if you resume payment. For forbearance to work, you need to be able to prove that you’re financially stable. Any missed payments will be factored in and will still need to be paid. If you want to know how to stop foreclosure, try this method.
Look at refinancing
In the events where a home has built up considerable equity over the period of ownership, you may be able to refinance the mortgage. The downside is that you do not get to enjoy the low-interest rate. However, you may even end-up having lower monthly payments to make, since you may be able to spread the payments over a longer period. This is arguably the ideal option if you can finance the new payments amounts as you recover from financial challenges.
Look at your expenses
When it comes to looking at ways of how to stop foreclosure, the most important thing is to look at the thing that brought you to the situation. Usually, there are a number of reasons that can affect your finances. It could be that you lost your job or even had other obligations that needed your attention. It is of great importance to look at the cause for this and look for a way to resolve the challenge.
If the reason for defaulting on your mortgage payment was increased responsibilities and other debts, it is recommendable you look for ways of boosting your income. For instance, you could take up an extra job or see if it is possible to add-in more hours at your place of work. The other alternative would be to lower your expenses so that it can match with your current financials.
It is important to learn how to prevent foreclosure since this could easily make you homeless, and recovering from this would be even more challenging. As a result, it is important to do what needs to be done, including finding a way to sell your home for value and cater to what you owe your lender. Statistics show that 250,000 new families enter into foreclosure every three months here in the US, and this data is quite alarming.