Three Things You Need to Know About Foreclosure, and Saving Your Home

The foreclosure process can be lengthy and complicated, but if you’re in the middle of it there are a number of things you can do to help avoid losing your home. One way to avoid foreclosure is by selling your home as soon as possible.

Foreclosure can be prevented in some cases by simply selling your home. If you can find an interested buyer before foreclosure proceedings begin, the sale can usually close quickly and avoid additional costs associated with foreclosure on your credit report. You can try to sell it yourself or hire a real estate agent.

If you can’t sell your house, there are other options for avoiding foreclosure. You may be wondering: can a loan modification stop foreclosure?

Depending on how far along foreclosure proceedings have gone, loan modifications can stop foreclosure in many cases. Loan modifications can allow borrowers who owe more than their homes are worth to get current on their mortgages or temporarily lower monthly payments if they’re struggling with unemployment or underemployment.

Filing for bankruptcy will not generally prevent foreclosure but can help keep borrowers from losing their homes. Filing for personal bankruptcy can offer another option for some homeowners. If borrowers can show they can’t afford monthly payments and can prove that foreclosure will cause more hardship than a bankruptcy filing, then borrowers can file to temporarily stop all foreclosure proceedings.

Another option is to get an assisted mortgage. This is where a sponsor can combine their income with yours to help with the mortgage. It is always best to consult with foreclosure attorneys to better understand your options.

Mortgage help center

According to The Wall Street Journal, data provided by CoreLogic indicates that there were a total of 620,111 U.S. completed foreclosures in 2013. It’s a high number, but not nearly as high as in 2012, when the number of foreclosures was over 820,000. Americans are doing better this year, but are by no means out of the woods.

If you are struggling and need home foreclosure help, we recommend contacting a HUD-certified home counseling agency. Here are three common questions people have about foreclosure.

Is my home in foreclosure?

This is a surprisingly common question. Many people who have missed a mortgage payment are unsure about when and how the foreclosure process begins. It takes several months — typically 90 days — of missed payments for the foreclosure process to begin. At that point, your bank with file a Notice of Default with county records. You will then receive a letter that your home is being put into foreclosure.

Can you save your home from foreclosure after the process has started?

You may be able to, depending on the circumstances. The sooner you address the problem, the better. If you already went 90 days or more without contacting your lender about possible mortgage restructuring when you knew there was a problem, that isn’t a good sign. Prioritize paying your mortgage bills. Most lenders will give you another 90 days to repay missed payments after the notice of default goes out. Bankruptcy can delay the foreclosure process, but does not put it on hold indefinitely.

How can a mortgage help center actually help me?

The process of foreclosure is different in every state. Speaking with a financial counselor is a good idea not only for figuring out how to prevent foreclosure now, but also for planning out your budget so that it is unlikely to happen in the future. HUD’s website advises that, “If you are experiencing difficulty communicating with your mortgage lender or service about your need for mortgage relief, there are organizations that can help by contacting [them] on your behalf.” A counselor can also advise you on the alternatives to foreclosure, such as short sales, deeds in lieu of foreclosure, and loan modifications. Short sales, for example, can be better for your credit report, even though you will still need to sell the home.

Are you in need of home foreclosure help? Let us know what challenges you’re facing in the comments. Continue reading here:

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