Foreclosure Relief Options
With high unemployment rates, a downward-spiraling economy and adjustable rate mortgages, many homeowners are facing the possibility of losing their home. Homeowners facing foreclosure not only face the prospect of losing their home, but having a tarnished credit report for years to come. While the prospect of losing your home may seem bleak, there are several foreclosure relief options available to you.
Talk to your lender
Mortgage lenders are typically willing to work out an arrangement with homeowners who are facing hard times. There are several options available, including:
- Repayment Plans
- Refinancing
- Forbearance
- Loan Modification
Be sure to contact your lender when you first suspect you may have problems making your mortgage payment if possible; lenders are more willing to work with homeowners who communicate their financial difficulties before missing a payment. Also, be sure to speak with someone from your lender’s loss mitigation department as they typically have more options to offer homeowners than the collections department.
See Avoiding Foreclosure http://www.bankruptcyinfonetwork.com/avoiding-foreclosure.htmfor more information.
Credit counseling
Legitimate credit counseling agencies can help you understand the different options available to you and help you develop a budget to meet your financial goals. See What is Credit Counseling http://www.bankruptcyinfonetwork.com/credit-counseling.htmfor more information.
Deed in lieu of foreclosure
A deed in lieu of foreclosure allows you to voluntarily hand over the deed to your property to your lender. In exchange for the deed to your home, the lender typically will forgive the outstanding balance on your mortgage. Though you still lose your home in a deed in lieu of foreclosure, you will avoid losing your home to a foreclosure. Keep in mind that a lender is not required to accept a deed in lieu of foreclosure.
Try to sell your home
You may be able to sell your home to pay off your mortgage debt if you still have some equity in the home; however, it may not be beneficial to list your home with a realtor if your home has little to no equity since what little equity you do have may end up going to cover realtor fees or not even be enough to cover realtor fees, meaning you will have to write a check to the realtor after your home is sold. Also, homeowners in crisis need to be aware of unscrupulous realtors who may inflate the asking price to increase their commission. It is better to sell your home and move on to a home that you can afford, than lose your home to foreclosure; a foreclosure will greatly impact your credit score and could make it difficult to purchase a home in the future.
Bankruptcy
There are different types of bankruptcy for different types of circumstances. The two main types of bankruptcy for consumers are chapter 7 and chapter 13. Based on your circumstances, you may be able to either reorganize your debt in a chapter 13 bankruptcy or receive relief from debt in a chapter 7 liquidation bankruptcy (see What Type of Bankruptcy Should I File? http://www.bankruptcyinfonetwork.com/type-bankruptcy.htm). An experienced bankruptcy attorney can help you understand the different types of bankruptcy and how you may be able to save your home from foreclosure by filing for bankruptcy.
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If you are overwhelmed by debt and facing foreclosure, contact a qualified bankruptcy attorney to discuss your options. A bankruptcy attorney can help you not only understand bankruptcy, but the various debt relief options available to you.
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