How to Avoid Foreclosure
With the unpredictability of daily life, it can be easy to fall behind on mortgage payments. Unfortunately, breaching your contract and missing a payment can lead to serious consequences. The last thing anyone wants is for their home to be foreclosed. Here are a few measures you can take to get back on track and avoid foreclosure.
Do Your Research
Florida is a judicial foreclosure state and so lenders must file a lawsuit against you in state court before moving in on your home. Luckily, this gives homeowners time to find a solution and fight the case. Read over everything you have received from your lender in the past, especially the paperwork regarding your mortgage, and educate yourself on your local foreclosure laws. The more knowledge you have about the predicament you are in, the higher the chance you can avoid foreclosure.
Speak to Your Mortgage Loan Servicer
If you are finding it difficult to make your mortgage payments then speak to your mortgage loan provider immediately. Don’t be a statistic. It is in your provider’s best interest to help you make your payments. Just one missed payment may not incur heavy consequences, however it still puts you in breach of your contract. Contact your servicer before this happens and be truthful about your financial situation. Work together to find a suitable solution that will allow you to keep your home.
How to Keep Your Home
Speak to your servicer about a reinstatement plan. This involves paying off the amount you owe before a specific deadline and is possible if you can provide evidence that you can make a lump sum payment by the specific date set by your servicer. This plan may incur late fees and other related expenses.
Agree on a forbearance period with your servicer. A forbearance plan offers short-term relief in the form of temporarily suspended or reduced payments. It is common to combine this agreement with a reinstatement or a repayment plan. You may be required to make a lump sum payment to cover the missed payments at the end of the plan.
Opt for a repayment plan. A repayment plan involves adding on an extra amount to your monthly payments for a fixed amount of time. Once your plan ends, you will have paid back the amount you owe in full.
Modify your loan. Speak to your servicer and see if you can come to an agreement which can help make payments more affordable. A loan modification requires a written agreement between yourself and your mortgage loan servicer.
What to Do If You Cannot Keep Your Home
Short sale your property. This option involves selling your property to avoid going into foreclosure. If the sales proceeds fall short of what you owe for your mortgage, your provider may still agree to accept the short sale if the sale closes.
Cancel your mortgage with a deed-in-lieu of foreclosure. A deed-in-lieu of foreclosure is the transfer of the title of your property to your servicer. This option can save you from a foreclosure, but usually you need to try and sell your home for a fair market value first.
File for bankruptcy. This option will only delay a foreclosure action, however it can buy you time to catch up on missed payments.
Sell to a Professional Home Buyer. Another option is to sell your house to a professional home buyer. This is a fast and simple process, with a home buyer, you can avoid the foreclosure altogether. You can fill out the form below to be contacted by a local home buyer that will offer you a fair cash offer for your home.
Foreclosures are common in most states. If you are teetering on the brink and you need further help, call the HOPE NOW alliance 24-hour hotline on 1-888-995-HOPE. They offer mortgage counseling assistance free of charge. Alternatively, you can find a U.S. Department of Housing and Urban Development (HUD) counselor on the Consumer Financial Protection Bureau website.
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