Do you Want to Stop the Foreclosure and Save your Home?
My number one wish for you is to be able to remain in your home if that is your desire, period.
First and foremost, TALK to your lender! Seriously! Respond to their letters by calling the phone numbers provided and ask for assistance. Ignoring the problem is the NUMBER 1 action most all people take who are in default of their loan. I've seen it, and I've heard home owners say this. Shame, embarrassment, denial are all normal feelings in your situation, but none of these will HELP you. Pick up the phone and call your lender, explain briefly why you fell behind in your payments, and ask for assistance and ask to hear your alternatives. Believe me, they have probably heard worse stories, so get it out there and get rid of that sick feeling in the pit of your stomach! You deserve a better night's sleep tonight to face the rest of this economy we are all suffering through.
The longer you wait, the less options you may have, but don't assume anything and just call!
RESOURCES
Websites for Assistance and Information
http://www.MakingHomeAffordable.gov/
http://www.hud.gov/foreclosure/ HUD's Guide to Preventing Foreclosure
http://www.hud.gov/foreclosure/workingwithlenders.cfm When a Lender Won't Work With You
Prevent Foreclosure by Contacting Your Lender
Here are some options that may be available to you:
1. Special Forbearance Your mortgage lender may be able to arrange a temporary reduction in your payment amount or even let you delay making payments for a period of time. This may help if you have experienced a temporary setback, and can now pay your normal payment if you could get beyond the 'late payments and penalties all due at one time'. Of course, the amount missed may be placed onto the end of your loan, or an additional repayment plan may be devised. Ask!
2. Mortgage Modification or Loan Re-Amoritization Your lender may refinance your loan, especially if you have an adjustable rate mortgage or a high interest loan. This will only work if your income remains high enough to qualify for the payment amount today. Ask!
Or, you may ask your lender to do a Loan Re-Amoritization on your current loan. Let's say you owe $150,000 on your loan, but because of missed payments and the penalties, you also owe $7500. Your lender may recalculate your loan and new payment to reflect your owing $157,500 now. Depending on the interest rate they allow you, your payment may increase slightly to cover your missed payments, but you will now be allowed to remain in your home and the foreclosure process will stop!
To numbers one and two above, you may be saying, "But Teresa, my financial situation has changed drastically and I simply cannot afford this house payment any longer!"
or
"We are needing to move because of work opportunities, divorce, lost a job, etc. and we have TRIED to sell this house and no one wants to pay us what we need to get out from under it. What are my options NOW?"
3. Deed-In-Lieu Of Foreclosure You may voluntarily "give back" your home to your lender, but you will have to vacate the home immediately. This may still be classified as a foreclosure on your credit history.
4. Foreclosure The legal court ordered process where your lender repossesses your home.
5. Short Sale In today's economy, more and more homeowners are turning to Short Sales to sell their homes and save their credit from a full-blown foreclosure and the ramifications of it. In a Short Sale, a lender agrees to accept less money for your home from a new buyer than what you now owe on the house. Usually, you may remain in the house until the sale closes to the new owner.
You may have tried to sell your home by owner to pay off your lender, and didn't succeed. Your home in 2009 may not be worth what you paid for it a short time ago, and a new appraisal price for a new buyer would not cover your old loan. You may have assumed that if you didn't have enough to cover the cost to pay off your loan, you certainly didn't have enough left over to pay a real estate agent to assist you!
Here is the beauty of a Short Sale: Your lender may accept a lower price for your home and will cover the costs for a real estate professional's services to assist you in locating a buyer and handling the transaction including your closing costs. In rare circumstances, your lenders may cut your agent's commission to a point where you may be asked to make up the difference. Your agent can work on your behalf while preventing a full Foreclosure from affecting your credit rating.
If you wish to discuss the possiblity of doing a Short Sale, call me at 251-554-2661.