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How much longer do I have to avoid foreclosure?
By Vic Hurlstorm | October 5, 2009
To stop foreclosure, you need to talk to your mortgage lender as soon as you find that you cannot keep up with your monthly payments. Contact your banker in the first month after you miss a loan payment, because the homes foreclosure process may speed up after that. As you fall further behind in your mortgage payments, it will become harder for you to avoid foreclosure.
If you feel that you can’t afford the monthly payments due to an event like a medical problem or job loss, you ought to talk to your lender even if you are current with your payments.
Loan modification is one of the options you can discuss with your lender. It involves changing the terms of a mortgage loan so you can have a reduced monthly payment. It may be right for you if you have a regular income, and the value of your home is more than what you owe on your home loan.
If you cannot afford the lower monthly payments, or if the value of your home is a lot less than what you owe on your mortgage, you can consider making a short sale. This involves selling your house for less than what you owe on your mortgage. The financier accepts the amount received as full payment for the home loan.
Your lender may start the foreclosure process 3 to 6 months after you miss the first payment, though late fees may be applicable after 10 to 15 days.
Read your loan documents to find out about the steps your lender may take if you miss payments. Contact your State Government Housing Office to find out about the relevant foreclosure laws and timeframes in your state.
Don’t avoid payment reminders sent by your lender. You could receive notices that will give you information about your options for getting through your financial difficulties and stopping foreclosure. Future notices may inform you about imminent legal action.
You can find useful information about foreclosure prevention on the website of the U.S. Department of Housing and Urban Development (HUD). You can visit the website of the HUD to look for an authorised housing counselor in your area. You can also seek the advice of an attorney or a trusted real estate agent.
You need to act quickly and do everything you can to stop foreclosure, because it can have a severe and long lasting effect on your record. Talk to your lender, and seek the help of an experienced advisor, as soon as you feel that you will not be able to keep up with your mortgage loan re-payments.
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