If you are facing foreclosure, there are a few things you can do to stop the process. Some options are available to you immediately while others take time. It’s important to note that your situation will vary depending on the laws in your state.
Foreclosure can be a stressful and overwhelming time. It can also put a huge dent in your credit rating, making it difficult to secure another mortgage or buy a home.
One way to prevent a foreclosure is to stay current on your mortgage payments. If you miss a payment, the lender will typically start the foreclosure process by sending you a notice of default. Once you receive a notice of default, it’s important to contact your lender right away and make sure they know you’re struggling.
Your lender may be able to work with you to get your loan current. This could include lowering your interest rate, deferring your payments or even giving you a loan modification.
It’s important to speak to a legal professional who can review your situation and determine the best course of action for you. A bankruptcy lawyer is often a good choice because they can help you restructure your debt and avoid a foreclosure.
Another option is to seek out a HUD-approved housing counselor and see what options are available to you. These counselors can help you assess your financial situation, offer stop foreclosure options for dealing with debt and discuss the possibility of a nonprofit debt management plan.
A debt management plan is designed to help you lower your unsecured debt, like credit cards, so that you can afford to make your mortgage payments. The program usually works with a third-party agency and you pay a fixed monthly fee to the nonprofit.
If you are struggling financially, a counselor can also help you find other ways to save your home. For example, the housing counselor might suggest a homeowner assistance fund that offers low-interest loans to homeowners who are behind on their mortgages.
You might also qualify for a government program that gives grants to states to help people who are struggling to afford their homes. However, you should check with your state’s housing authority to be sure that this will help you before you start applying for a program.
Then again, there are some predatory lenders out there who prey on homeowners who are facing foreclosure. If you have been victimized by a scam or fraud, it’s important to contact your local consumer protection agency and file a report.
Finally, it’s important to speak with a mortgage attorney before you sign any paperwork or agree to anything. A legal professional can provide you with a free consultation and help you determine whether filing for bankruptcy is the right decision for you.
If you do decide to file for bankruptcy, your lender will likely have to wait until the court order is in place. The time frame varies by state, so you should do your research and be sure to consult with an experienced bankruptcy attorney in your area.