If you have defaulted on your mortgage, your lender may take possession of your home. This process is called foreclosure. Foreclosure is a devastating experience that destabilizes communities and has a negative impact on families. The good news is that there are methods to prevent foreclosure.
If you find yourself falling behind on your mortgage payments, it is important to act as fast as you can. The faster you act, the more chances you have to save your home. Here is what can be done to prevent foreclosure.
Modify Your Loan
If you realize that you cannot afford monthly mortgage payments anymore, you can try to modify your loan. A land modification can help you reduce your monthly payments or interest rate. You may also be eligible for the Homeowner Affordability and Sustainability Plan. It is intended to help those homeowners who are in debt and need to restructure their loan.
Discuss a Payment Plan
Your lender may offer you a special payment plan, so you can get caught up over a certain period of time. However, it is important to understand that a payment plan does not reduce the amount you owe. There are certain factors that determine the length of a repayment plan, including how much you can pay every month and the amount that is past due. Before choosing this option, you need to make sure that you will be able to pay more money every month until becoming current.
Consider a Deed in Lieu
A deed in lieu is a process where a homeowner turns over their home to the lender voluntarily in order to avoid or stop foreclosure. It seems to be a good option, but it is important to know that a deed in lieu has a negative effect on your credit score just like foreclosure and does not allow a homeowner to get another loan for several years.
Do a Short Sale
The term “short sale” means selling a property for less than the outstanding loan amount. If a lender agrees to a short sale, they take the proceeds and forgive the remaining debt. You can also ask your lender to agree in writing to waive any deficiency before a short sale so that they cannot collect the remainder of the mortgage from you when the sale is completed.
Talk to a HUD-Approved Housing Counselor
It is highly recommended you talk to a HUD-approved housing counselor from the Department of Housing and Urban Development before making any decisions and signing any agreements. The mission of HUD-approved housing counselors is to offer counseling to homeowners struggling with their monthly mortgage payments. You can discuss your situation with a counselor, and they may help you find a solution. They can also help you solve other financial challenges, including credit card debts.
Sell Your Home Quick to a Home Investor
Many homeowners do not know, but there is an effective method to avoid foreclosure without any consequences — selling property to a home investor or cash buyer. One of the main benefits of this method is that you can sell your home immediately, which is important for those who are going through foreclosure. In addition, you do not have to worry about any repairs or even cleaning because home investors purchase properties as is.
If you own a home in Colorado Springs or any other nearby community, and you want to sell it as quickly as possible to avoid foreclosure, We Buy Houses Colorado Springs is ready to help you. We are ready to buy your home right now, for cash, and under any circumstances. Foreclosure is not a problem for us as we know how to deal with foreclosed properties. Whether you have questions or you have a home for sale, feel free to call us any time and request the information you need.