Dealing with foreclosure can be a stressful situation but few homeowners realize that there are several ways to prevent foreclosure because they have been misinformed. When a bank attempts to repossess your home, you have certain rights and many options available. The CHIODO Team has been helping clients avoid foreclosure and obtain the resources they need to get back on a positive track. Here are some important tips for avoiding foreclosure:
Tips to Avoid Foreclosure
When you’re having difficulty keeping up with your mortgage payments because of a changing financial situation, you could be at risk for foreclosure. Losing a job, divorce, an increase in taxes or unforeseen medical expenses can all make it difficult to make your house payment.
Few people think they will lose their home until it’s too late. Don’t be one of them!
Here are some tips for avoiding foreclosure:
- Acknowledge that you’ve missed a payment or several payments. Don’t ignore the problem because it will only get worse!
- Get in touch with your lender. Some lenders do have options for borrowers who are having difficulty making their monthly payment. If you need further assistance, consider contacting a CHIODO team member to guide you through the process.
- Respond to all messages from your lender. If you are taken to court, failure to stay in touch with your lender cannot be used as an excuse. Open all of your mail and return calls.
- Know your rights. Foreclosure laws in Florida are listed in your loan documents. Make sure you’re aware of all of your rights and if you have questions, contact a CHIODO team specialist for clarification.
- Learn about the alternatives to foreclosure (see below).
- Review your assets. Take stock of the assets you might be able to liquidate if you needed cash quickly. Could you sell a second car, recreational vehicle or a boat? Would you be able to pick up a second job?
- Don’t fall for foreclosure scams. There are dozens of foreclosure “recovery companies” out there that promise to help you get back on track, but many are for-profit and cannot really help you. Your best option is to work with a real estate professional such as the CHIODO Team to get the straight facts about your rights and develop a surefire strategy.
Alternatives to Foreclosure
Only some homeowners know that there are some options available when they are facing foreclosure. These include:
Special Forbearance: The lender can review the financial situation and make arrangements for a repayment plan. Homeowners that have experienced a reduction in income or an increase in living expenses may be eligible for this type of loan.
Partial Claim: The lender may be able to work with the homeowner to obtain a one-time payment from the FHA-Insurance fund. Homeowners that have a loan that is at least 4 months delinquent (but not more than 12 months delinquent) and are able to begin making full mortgage payments again may qualify for this type of loan.
Mortgage Modification Loans: Homeowners can avoid foreclosure by refinancing the debt or extending the term of their mortgage loan. This can bring the monthly payment down to a more affordable level and can help the homeowner recover during their difficult time.
If you are facing foreclosure or want to learn more about your options, contact the CHIODO Team for guidance, support and have all of your questions answered.