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How to Stop Foreclosure on Your Own
Alternatives to Foreclosure
There are alternatives to foreclosure. The options will depend not only on your circumstances, but on the type of mortgage you have. For an FHA or VA mortgage, possible foreclosure alternatives are set by those respective federal agencies -- the U.S. Department of Housing and Urban Development for FHA loans and the Veterans Administration for VA loans.
Alternatives to foreclosure when you can afford to keep the home.
Sometimes people may experience a temporary reduction in income or financial hardship, such as an illness. When this happens, they may temporarily be unable to make their mortgage payments. Once the situation improves, however, they may be able to resume the scheduled payment of the mortgage.
In a situation such as this, they may look at the following options:
Repayment Plan: You may be able to arrange an increase in monthly payments until the loan is brought current. This means that each month you would add an additional amount of money (determined by the mortgage company) to their regular monthly payment until the amount that was overdue has been repaid.
Forbearance: Forbearance is a formal, written agreement between you and the mortgage company to reduce or suspend monthly payments for a specific period of time. This means that for a period of time, your clients would either pay only a portion of their regular mortgage payment or not make any payments at all. At the end of the agreed-upon period, you would be required to resume regular monthly payments as well as pay additional funds to make up for the past due amount. During the time that the payments are either suspended or reduced, you would have the opportunity to resolve the financial hardship you are facing.
Loan modification: In situations where the mortgage company does not believe that a repayment plan or forbearance is the appropriate course of action, a loan modification may be considered. A loan modification involves changing one or more of the terms of a mortgage in order to help you bring a defaulted loan current and prevent foreclosure. This option generally is considered for homeowners whose financial problems are expected to be more long term.
Alternatives to foreclosure when you cannot afford to keep your home.
As hard as you might try, sometimes financial hardships don't get turned around as quickly as we would like. These situations may include a long-term layoff, job loss, mandatory reduction in pay, disability or illness that results in a decrease in income or an increase in major medical expenses, or the death of the principal wage earner.
In these instances, it may not be possible for you to continue to meet all of your financial obligations and the only appropriate course of action is relinquishing ownership of the home, while avoiding foreclosure. These alternatives include:
Assumption of the loan: An assumption is a method of transferring a house to a new buyer who agrees to take responsibility for (assumes) the existing mortgage. Not all mortgages are assumable, so this option must first be discussed with the mortgage company.
Deed-in-lieu of foreclosure: A deed-in-lieu of foreclosure takes place when you voluntarily give the deed to the property to the mortgage company generally, a deed-in-lieu is considered only after all other alternatives to foreclosure have been explored.
Preforeclosure sale:A preforeclosure sale is the sale of a property in which the mortgage company agrees to accept the proceeds of the sale, even though it may be less than the amount owed on the mortgage. To avoid going through a foreclosure proceeding, the mortgage company can agree to accept the proceeds of the sale in satisfaction of the mortgage loan. Normally the full amount of the loan must be paid in a preforeclosure sale.
If you think a preforeclosure sale is the best option for you We can make you an offer to purchase your property. The process is simple. We are a local company and do not have to wait for a bank?s approval. Just give us a call so we can gather some information. Then we will make your an offer on the phone, or schedule a time to view the property. If we can?t make an offer on the phone, we will make an offer within 24 hours of viewing your property. If you decide to sell your property we will close as quickly as possible often within 5-10 days.
CALL TODAY for a FREE no cost and no obligation consultation on how we can save your property from foreclosure, and save your credit before it's too late.
We have helped property owners all over Nashville and we Can Help You Too!
Call now 385-1800
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