Avoid Foreclosure

If you are behind in payments on your home loan (mortgage) or are in default on your mortgage, you should be careful and avoid foreclosure. 

Don’t lose your home to foreclosure without consulting with an experienced professional Realtor and get help to save your home and credit history.

Always stay in touch with your lenders.  The first time you receive a letter from the lender, you should contact them and talk about your payments and terms.   Hiding from your lender won’t help.  Communicate with your lenders, so that you can work out an agreement.  You can ask for changing of payment options or terms, which can be easier for you as the borrower to avoid foreclosure.

Problems making your mortgage payment?   Here are a few options for those who can’t make their mortgage payments or may have short-term financial problems and want to avoid foreclosure:

Forbearance  ~  A temporary agreement with lender that delays payments for a short period of time.  Mortgage lenders will only allow forbearance if you can prove you’ll eventually acquire funds.  Some common examples would be a tax refund or a bonus where you can show future earnings that can bring your mortgage up-to-date.

Reinstatement  ~  If you’re behind on your mortgage payments, a reinstatement can take place when you make a lump sum payment by a specified date, bringing your account back to current status.  Lenders often combine reinstatement with forbearance.

Repayment Plan  ~  If you’re behind on your payments, the mortgage company might may give you a fixed amount of time to catch up and then combine a portion of your past due amounts with your regular payments, allowing you to get current.

Loan Modification  ~  Terms of your loan can be adjusted.  Changing the amortization table or lowering your interest rate can make a big difference, reducing your monthly payment amount to something you can afford.

Short Sale  ~   A deal between the homeowner and lender to sell the property for less than it’s worth, with the mortgage lender taking the loss.

Pre-foreclosure sale  ~  A pre foreclosure sale is an effective way of stopping foreclosure, allowing a default homeowner to satisfy his mortgage obligation by selling the property in question for an amount less than owed.

Deed-in-lieu of foreclosure  ~  This last resort allows you to “give back” your property to the lender.   This will leave a mark on your credit record, but it will stop foreclosure, which is more severe.

Credit Counseling  ~  A non-profit credit counseling agencymay be able to help you prevent a real estate foreclosure.  Be especially leery of fee-based groups approaching you with bank foreclosure solutions.   They’ll often recommend (at a cost) what we’ve covered above, most of which you can do on your own or with the assistance of a HUD-approved counseling agency.  Contact a HUD-approved housing counselor online or by calling (800) 569-4287 or TDD (800) 877-8339.

Taking a pro-active approach to AVOID HOME FORECLOSURE is essential.

1.  Reinstatement of the loan
2.  Forbearance agreement
3.  Loan Modification
4.  Obama Home Affordable Plan
5.  Rent the property out to others
6.  Sell the property
7.  Deed in Lieu of foreclosure
8.   Short Sale
9.  Short Pay Refinance

Filing bankruptcy would also help you avoid foreclosure.  However, this should be only your last resort.  There is a price to pay in terms of credit history damage from bankruptcy and that you probably wouldn’t be able to buy another property with a loan for 7 or more years.

If you own property in Orange County, CA, and are unable to make payments on your home loan, consult with an experienced REALTOR professional now to get help and AVOID FORECLOSURE.

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This is for information only and not the providing of tax or legal services.   You should consult with a experienced professional Realtor if you need to avoid foreclosure and also with an attorney for legal issues.

Harrison K. Long - solutions for real estate and business -  GRI, REALTOR and broker associate, Coldwell Banker Residential Brokerage - 949-854-7747 (phone) – ExploreProperties@gmail.com (email) - CA DRE 01410855 ~ also serving as an appointed director at the California Association of Realtors  –  attorney member of the California State Bar Association