How can I Avoid Foreclosure?

When you miss your mortgage payments, foreclosure will occur. Foreclosure is the action of the bank taking over your home in order to try and resale the house and make their money back from the sale. If your property is worth less than the total amount you owe on your mortgage loan, your mortgage company could seek a deficiency judgment. A deficiency judgment is when the sale of your home on the foreclosed market does not cover all of the lenders cost and they look to you for payment of the remaining amount. Foreclosure or a deficiency judgment could seriously affect your ability to qualify for credit in the future. If you are having problems making your payments, contact your mortgage company immediately. Explain your situation. Be prepared to provide them with financial information, such as your monthly income and expenses. Without this information, they may not be able to help. Stay in your home for now. Some of your options include the following:

Special Forbearance:
If you have recently lost your job or your source of income your mortgage company may be able to arrange a repayment plan based on your financial situation. Your mortgage company may even provide for a temporary reduction or suspension of your payments. You must contact your mortgage lender to inquire about the various options.

Mortgage Modification:
You may be able to refinance the debt and/or extend the term of your mortgage loan in order to help you catch up by reducing your monthly payments to a more comfortable level. Qualification is based off the fact that your net monthly income has decreased prior to the non payment of your mortgage.

Partial Claim:
Under the partial claim option, a lender will advance funds on behalf of a mortgagor in an amount necessary to reinstate a delinquent loan (not to exceed the equivalent of 12 months PITI ). The mortgagor, upon acceptance of the advance, will execute a promissory note and subordinate mortgage payable to HUD. Currently, these promissory or "partial claim" notes carry no interest and are not due and payable until the borrower either pays off the first mortgage or no longer owns the property.

Deed-in-lieu of foreclosure:
With this option you would give the home back to the mortgage company prior to foreclosure. This will enhance your chances in the future to get another loan on another home in the future. You can contact us or your current lender for the qualifying guidelines.