Most available information on stopping foreclosures includes refinancing your mortgage as an option. Well, how true is that?
Let's face it. Most people going through foreclosure do not contact their lender until it's too late. For some reason, they believe the problem will somehow disappear. Unfortunately, by the time the homeowner responds to the foreclosure notices, they are several months behind in mortgage payments. Most banks will not refinance the homeowner if they are not current on their existing mortgage, which doesn't make refinancing a viable solution. Or, so one would think.
There is no magical solution to stopping foreclosure. It is a difficult thing to do especially if the homeowner does not have the money to bring their mortgage current. Unfortunately, when it comes to stopping a foreclosure, mortgage brokers will say exactly what the homeowner wants to hear. The end result is typically wasted time, which is something the homeowner does not need. Depending on state laws and the lender, the homeowner has approximately 6 to 8 months from their last payment until they lose their home in a foreclosure sale.
One may ask, why would a mortgage broker waste a homeowner's time if they know they are not current on mortgage payments? Isn't their payment history reported to the credit bureaus? And, don't they request a copy of their credit report? The answer is yes to both. However, the simple truth is that a lot of mortgage companies are only looking to collect applications. Some, not all, are graded based on the number of leads they generate within a given month. Regardless of the final outcome, the homeowner is still considered a lead, which looks favorable to management. Unfortunately for the homeowner, by the time they are done, a month or two has been lost wishing for something that would never happen.
In some cases, these same mortgage companies will collect upfront fees, knowing the homeowner won't be approved. They will pretend to work on the file once the fee is collected only to reject the application soon afterwards. Again, they will say whatever the homeowner wants to hear; thus, taking advantage of their desperate situation while profiting at the same time.
Well then, who can refinance as a way to avoid foreclosure? Generally speaking, no one unless the homeowner acts fast before they are several months behind in mortgage payments and have sufficient income to pay the new loan. The closer the homeowner gets to the foreclosure date, the less likely the lender will work with them, and the chances of refinancing diminish greatly.
Don't be disappointed because all hope is not lost. HUD has a program that will make a one-time loan equal to the homeowner's past due mortgage payments. It's a special program only for homeowners who have an FHA-insured loan. These loans are zero-interest loans with no monthly payments. They are paid in full when the homeowner refinances or sells their home. Please check HUD's website at http://www.hud.gov/foreclosure/index.cfm for more information. HUD's guidelines and programs often change depending on current need.
There are other types of lenders called hard money lenders, who are private investors that will loan money without any underwriting guidelines. These loans are for short periods and cost considerably more than traditional loans. However, it may help in the interim by stopping the foreclosure. If a homeowner goes this route, make sure they completely understand the terms especially the new monthly mortgage payment, interest rate, and the amount of points that will be paid upfront or on the backend. Also, the new payment could be more than the current one.
Perhaps, a better option to refinancing is to have a friend or a relative purchase the home and lease it back to the homeowner. This way they will not have the expensive fees associated with a hard money lender and the friend or relative will be more forgiving and sympathetic to their situation than a bank or an investor. A variation to the above is to include the homeowner's name on the deed as well.
In summary, act quickly, consider your refinance options, and don't waste time with mortgage lenders who will give you the runaround. Also, whatever the refinancing option, the homeowner must have sufficient income to pay the new mortgage payment or the lender will deny the application.
For more information, CP Howard is the author and can provide additional information when trying to stop a foreclosure by refinancing: Avoid Foreclosure eBook is for immediate download at Help Stop The Foreclosure.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
website: www.MaxCapLLC.com
Saturday, August 15, 2009
Deed in Lieu of Foreclosure as a Way to Stop Foreclosure
There are many different options available to homeowners for stopping a foreclosure. Some of them include selling the property, bankruptcy, and deed in lieu of foreclosure just to name a few.
First, a foreclosure is the legal process a lender uses to take a home when a homeowner defaults or do not make their mortgage payments. Pre-foreclosure is the period prior to the foreclosure between the lender's initial notice of foreclosure to the actual date of the foreclosure sale. All foreclosure sales can be halted at anytime during this period.
Second, a deed is the instrument that conveys or transfers ownership of a property from a seller to a buyer or a grantor to a grantee as in the case of a Deed in Lieu of Foreclosure.
In essence, the Deed in Lieu of Foreclosure strategy simply involves giving the property back to the bank. The grantor, the buyer, would convey or transfer the property through a Deed of Trust to the grantee, the lender. Both parties in the transaction must enter into the agreement in good faith and voluntarily. What this does is enacts the parol evidence rule, protecting the lender from subsequent claims that he or she acted in bad faith or otherwise pressured the borrower into this type of settlement.
Here are a couple of points a homeowner should know when considering a Deed in Lieu of Foreclosure:
1) your lender's acceptance is completely voluntary. It's not an obligation or a homeowner's right,
2) it is best to have some equity to ensure the loan amount is covered when the property is sold, and
3) if there isn't any equity and the lender accepts the Deed in Lieu of Foreclosure, then the homeowner may have to pay income tax on the difference.
For example, after returning the property to the lender, the home sold for $180,000. However, the homeowner owed $200,000; thus, the lender lost $20,000. The homeowner may have to pay income tax on that $20,000. Let me explain why this could be the case. When the money was borrowed to purchase the home, the homeowner was expected to repay the loan. When they didn't repay, the lender and the IRS will look at that $20,000 as income to the homeowner because they received it, but did not pay it back. Consequently, if the homeowner didn't include a clause stating that their lender will absolve any deficiency, then the homeowner could possibly be looking at a tax bill.
Deed in Lieu of Foreclosure is just one of several options available to a homeowner for stopping a foreclosure. For more information, CP Howard is the author and can provide additional information regarding direction when facing a foreclosure: Avoid Foreclosure eBook is for immediate download at Help Stop The Foreclosure.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
website: www.MaxCapLLC.com
First, a foreclosure is the legal process a lender uses to take a home when a homeowner defaults or do not make their mortgage payments. Pre-foreclosure is the period prior to the foreclosure between the lender's initial notice of foreclosure to the actual date of the foreclosure sale. All foreclosure sales can be halted at anytime during this period.
Second, a deed is the instrument that conveys or transfers ownership of a property from a seller to a buyer or a grantor to a grantee as in the case of a Deed in Lieu of Foreclosure.
In essence, the Deed in Lieu of Foreclosure strategy simply involves giving the property back to the bank. The grantor, the buyer, would convey or transfer the property through a Deed of Trust to the grantee, the lender. Both parties in the transaction must enter into the agreement in good faith and voluntarily. What this does is enacts the parol evidence rule, protecting the lender from subsequent claims that he or she acted in bad faith or otherwise pressured the borrower into this type of settlement.
Here are a couple of points a homeowner should know when considering a Deed in Lieu of Foreclosure:
1) your lender's acceptance is completely voluntary. It's not an obligation or a homeowner's right,
2) it is best to have some equity to ensure the loan amount is covered when the property is sold, and
3) if there isn't any equity and the lender accepts the Deed in Lieu of Foreclosure, then the homeowner may have to pay income tax on the difference.
For example, after returning the property to the lender, the home sold for $180,000. However, the homeowner owed $200,000; thus, the lender lost $20,000. The homeowner may have to pay income tax on that $20,000. Let me explain why this could be the case. When the money was borrowed to purchase the home, the homeowner was expected to repay the loan. When they didn't repay, the lender and the IRS will look at that $20,000 as income to the homeowner because they received it, but did not pay it back. Consequently, if the homeowner didn't include a clause stating that their lender will absolve any deficiency, then the homeowner could possibly be looking at a tax bill.
Deed in Lieu of Foreclosure is just one of several options available to a homeowner for stopping a foreclosure. For more information, CP Howard is the author and can provide additional information regarding direction when facing a foreclosure: Avoid Foreclosure eBook is for immediate download at Help Stop The Foreclosure.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
website: www.MaxCapLLC.com
Avoid Foreclosure by Getting Rid of the Property
The majority of people would like to find ways to keep their homes safe from the foreclosure sale. Additionally, they may not desire to even retain ownership of the property. If this fits you, here are some ways to dispose of the property in order to prevent a foreclosure sale. These options will affect your credit rating a lot less than the actual foreclosure.
- Selling the Property - This strategy to avoiding foreclosure involves simply selling the home for a profit. Typically, this is a viable option when you have equity, the property is marketable, and you are in a desirable area. You may work with a real estate agent whom you trust or sell the property yourself.
- Sell the Property via an Assumption - This strategy to avoiding foreclosure involves finding a buyer who will assume your loan, move into your property, and continue making mortgage payments to your lender. FHA and VA loans are assumable. However, you want to make sure your lender will absolve you from any and all responsibility once the buyer has assumed your loan.
- Pre-Foreclosure Sale or Short Selling - This option allows the homeowner to sell the property for less than the loan amount. Be aware of the following: 1) this may trigger a taxable event for the homeowner on the difference between the amount of the sale and the loan, and 2) this is a courtesy of your lender, not a right of the homeowner or an obligation of the lender.
- Deed in Lieu of Foreclosure - This strategy consists of giving the property back, sometimes called deeding the property, to your lender prior to the foreclosure sale. Like a short sale, the lender is not obligated to do this. And, if they do, you should have enough equity to where the sale covers the loan. If not, your lender may not approve or you could trigger another taxable event on the difference.
The key to disposing your property is to act fast. In this case, do not expect to fetch top dollar because the buyer, if they know the reasons for the sale, will want a discount. In many cases, if your objective is to avoid the foreclosure sale, you may have to accept what you are offered. Your most probable buyer will be an investor who has the funds to close and do it quickly. You will release more equity than you would like. However, you will avoid a foreclosure on your record.
It's never a good idea to give up your home. In some situations, this is your only option to protect yourself from a foreclosure by unloading the property to an investor; thus, paying the entire mortgage loan off quickly. Unfortunately, if you wait and the lender takes your home, you will get far less for it than you deserve and may still end up owing money to the lender.
For more information, CP Howard is the author and can provide additional information on avoiding foreclosure by disposing your property: Avoid Foreclosure eBook is for immediate download at Help Stop The Foreclosure.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
website: http://www.maxcapllc.com/
- Selling the Property - This strategy to avoiding foreclosure involves simply selling the home for a profit. Typically, this is a viable option when you have equity, the property is marketable, and you are in a desirable area. You may work with a real estate agent whom you trust or sell the property yourself.
- Sell the Property via an Assumption - This strategy to avoiding foreclosure involves finding a buyer who will assume your loan, move into your property, and continue making mortgage payments to your lender. FHA and VA loans are assumable. However, you want to make sure your lender will absolve you from any and all responsibility once the buyer has assumed your loan.
- Pre-Foreclosure Sale or Short Selling - This option allows the homeowner to sell the property for less than the loan amount. Be aware of the following: 1) this may trigger a taxable event for the homeowner on the difference between the amount of the sale and the loan, and 2) this is a courtesy of your lender, not a right of the homeowner or an obligation of the lender.
- Deed in Lieu of Foreclosure - This strategy consists of giving the property back, sometimes called deeding the property, to your lender prior to the foreclosure sale. Like a short sale, the lender is not obligated to do this. And, if they do, you should have enough equity to where the sale covers the loan. If not, your lender may not approve or you could trigger another taxable event on the difference.
The key to disposing your property is to act fast. In this case, do not expect to fetch top dollar because the buyer, if they know the reasons for the sale, will want a discount. In many cases, if your objective is to avoid the foreclosure sale, you may have to accept what you are offered. Your most probable buyer will be an investor who has the funds to close and do it quickly. You will release more equity than you would like. However, you will avoid a foreclosure on your record.
It's never a good idea to give up your home. In some situations, this is your only option to protect yourself from a foreclosure by unloading the property to an investor; thus, paying the entire mortgage loan off quickly. Unfortunately, if you wait and the lender takes your home, you will get far less for it than you deserve and may still end up owing money to the lender.
For more information, CP Howard is the author and can provide additional information on avoiding foreclosure by disposing your property: Avoid Foreclosure eBook is for immediate download at Help Stop The Foreclosure.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
website: http://www.maxcapllc.com/
Tuesday, August 11, 2009
Are You Facing Foreclosure?
The legal process a lender uses to take your home when you default is called a foreclosure. Default is a legal term that means you didn't make your mortgage payments. The lender has this right because they use your home as collateral for your loan. Below are some questions you might be interested in regarding what to do if faced with a foreclosure.
If I fall behind in payments, what should I do?
The number one thing you always want to do when facing a foreclosure is NEVER avoid your lender. You want to act quickly to stop the foreclosure and contacting your lender is the first step. Let them know you have received all notices and that you want to work with them to resolve the issue fast. Most lenders do not want your home because they are not in the business to own real estate. They want to lend money. Consequently, they will work with you as much as you are willing to work with them.
What options are available through my lender?
Your lender could do several things when it comes to assisting you. The most common is to grant a payment plan on the amount that is past due. Other options may include adding the amount in arrears to the end of your loan, which means your loan would extend by the number of monthly payments you are behind.
What if my lender does not provide any assistance?
A couple of options you can examine are calling another lender to see if they would refinance your existing loan. This is not a reliable option because most lenders won't refinance your loan if you are behind in payments or do not have the income to qualify for the loan.
Selling your home is an option especially if you have equity. Equity is the difference between what your home is worth and your loan amount. If you do not have equity, short selling your house is another option. Perhaps, the bank will accept less than the loan amount as the full payoff.
Speaking with a lawyer is yet another option. An attorney can review your loan documents and possibly find something to litigate with; thus, canceling or postponing the foreclosure. If not, filing bankruptcy can help you keep your home as well.
What is the foreclosure process?
There are two types of foreclosures: judicial and non-judicial. In general a judicial foreclosure has to go before the courts while a non-judicial foreclosure does not. We won't go into details because all you need to know is that the typical foreclosure starts approximately 3 months after your last payment. It could be slightly shorter or longer. Keep in mind, the lender has the right to start the foreclosure proceedings the day after you become delinquent.
After your delinquency, you'll receive a Notice of Default indicating that you are facing foreclosure. The notice will outline the amount in arrears, what's required to stop the foreclosure, and important dates. Most states allow for a redemption period-a time prior and subsequent to the actual foreclosure sale whereby the homeowner can redeem the home. The closer you get to the foreclosure sale date the more the lender will want the entire loan amount to be paid in full. This is why you must act quickly and early.
When can my lender sell my home?
Prior to the lender selling your home they must notify you of the sale. Typically, the sale will appear in a legal newspaper. The notice should contain the date, time and place of the sale. It also must appear as public information a certain number of days prior to the sale, usually 20 to 30 days.
How do I stop the sale of my home?
There are no magic solutions for stopping a foreclosure. As mentioned before, you may pay the amount requested by the bank, sell your home prior to the sale, or file bankruptcy. An excellent resource that covers many other ways to stop a foreclosure is http://www.HelpStopTheForeclosure.com/.
Watch out for scams!
There are many legitimate companies and organizations that will assist in stopping a foreclosure. However, a lot of them are scams. Watch out for people who promise to stop the foreclosure by having you quitclaim the property to them. Oftentimes, they will make an offer that is attractive to you, promise they can help, wait until the clock runs down, and then approach you with a lower offer when it's too late. Consequently, you feel pressured to do something such as accept the lower offer. The resource mentioned above covers real estate scams you need to be aware of.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
Website: http://www.MaxCapLLC.com/
If I fall behind in payments, what should I do?
The number one thing you always want to do when facing a foreclosure is NEVER avoid your lender. You want to act quickly to stop the foreclosure and contacting your lender is the first step. Let them know you have received all notices and that you want to work with them to resolve the issue fast. Most lenders do not want your home because they are not in the business to own real estate. They want to lend money. Consequently, they will work with you as much as you are willing to work with them.
What options are available through my lender?
Your lender could do several things when it comes to assisting you. The most common is to grant a payment plan on the amount that is past due. Other options may include adding the amount in arrears to the end of your loan, which means your loan would extend by the number of monthly payments you are behind.
What if my lender does not provide any assistance?
A couple of options you can examine are calling another lender to see if they would refinance your existing loan. This is not a reliable option because most lenders won't refinance your loan if you are behind in payments or do not have the income to qualify for the loan.
Selling your home is an option especially if you have equity. Equity is the difference between what your home is worth and your loan amount. If you do not have equity, short selling your house is another option. Perhaps, the bank will accept less than the loan amount as the full payoff.
Speaking with a lawyer is yet another option. An attorney can review your loan documents and possibly find something to litigate with; thus, canceling or postponing the foreclosure. If not, filing bankruptcy can help you keep your home as well.
What is the foreclosure process?
There are two types of foreclosures: judicial and non-judicial. In general a judicial foreclosure has to go before the courts while a non-judicial foreclosure does not. We won't go into details because all you need to know is that the typical foreclosure starts approximately 3 months after your last payment. It could be slightly shorter or longer. Keep in mind, the lender has the right to start the foreclosure proceedings the day after you become delinquent.
After your delinquency, you'll receive a Notice of Default indicating that you are facing foreclosure. The notice will outline the amount in arrears, what's required to stop the foreclosure, and important dates. Most states allow for a redemption period-a time prior and subsequent to the actual foreclosure sale whereby the homeowner can redeem the home. The closer you get to the foreclosure sale date the more the lender will want the entire loan amount to be paid in full. This is why you must act quickly and early.
When can my lender sell my home?
Prior to the lender selling your home they must notify you of the sale. Typically, the sale will appear in a legal newspaper. The notice should contain the date, time and place of the sale. It also must appear as public information a certain number of days prior to the sale, usually 20 to 30 days.
How do I stop the sale of my home?
There are no magic solutions for stopping a foreclosure. As mentioned before, you may pay the amount requested by the bank, sell your home prior to the sale, or file bankruptcy. An excellent resource that covers many other ways to stop a foreclosure is http://www.HelpStopTheForeclosure.com/.
Watch out for scams!
There are many legitimate companies and organizations that will assist in stopping a foreclosure. However, a lot of them are scams. Watch out for people who promise to stop the foreclosure by having you quitclaim the property to them. Oftentimes, they will make an offer that is attractive to you, promise they can help, wait until the clock runs down, and then approach you with a lower offer when it's too late. Consequently, you feel pressured to do something such as accept the lower offer. The resource mentioned above covers real estate scams you need to be aware of.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
Website: http://www.MaxCapLLC.com/
Saturday, August 8, 2009
6 Steps to Protect Your Home from Foreclosure
When facing a foreclosure, all is not lost. There is still hope in protecting yourself. Oftentimes, people procrastinate when the lender has expressed his plans to foreclose. When this happens your time is extremely limited and you must act fast to be successful. Here are some steps you need to follow to stop a foreclosure and protect yourself.
1 - Do Not Ignore Your Lender or the Problem. Your success rate to stop or protect yourself from foreclosure drastically decreases as time passes. Your lender is more willing to work with you in the beginning stages of the process than if you wait only weeks prior to the foreclosure sale.
2 - Contact Your Lender Immediately. In fact, at the very first sign of trouble—before you are late—you should contact your lender and begin discussing your options. Remember, foreclosure doesn’t happen overnight. Every homeowner knows well in advance if keeping up with future mortgage payments will be a problem. In reality, lenders do not want your home no more than you want to give it up. They would rather you pay the mortgage on time, allowing them to recoup their investment. Consequently, they provide several options for defaulting homeowners.
3 - Stay in Touch with Your Lender throughout the Entire Process. In addition to not ignoring your lender or the problem, stay in step with every correspondence you receive. In other words, open and respond to any and all mail from your lender. Because foreclosure law requires actual notice, the lender’s initial communication will have very important information such as contact information, amounts to reinstate your loan, and timeframes. Oftentimes, homeowners will discard correspondences from the lender because it is mixed in with private companies selling their foreclosure help services. Take the time to review what is and what isn’t from your lender.
4 - Know Your Foreclosure Rights and Options. Do not rely solely on your lender to inform you of your rights or options. Although you must work with your lender, their interest is not to protect you. There is a lot of valuable information relating to foreclosure prevention online. One of them I recommend is http://www.HelpStopTheForeclosure.com. It's a rare resource that offers proven techniques to stop a foreclosure and protect the homeowner.
5 - Use Your Assets to Your Advantage. If the problem causing you to be in foreclosure was temporary, then use your assets to the best of your ability. For example, you lost your job but are now employed and can resume making mortgage payments. Think of assets you can liquidate or sell for cash to help reinstate your loan. Perhaps, some examples are jewelry, a second vehicle, a life insurance policy, a retirement account, furniture, antiques or other collectibles etc.
6 - Avoid Companies that Charge Money to Stop Foreclosure. Stopping a foreclosure is something you can do yourself. Because actual notice is given to the public during the foreclosure process, you will receive many mailings from companies and private investors claiming to have the magic pill for your situation. Although they may be legitimate companies, do not fall for the tricks. Perhaps, those options will work for you. However, you will give up something—usually cash or equity—in order to do what you can do yourself. The above mentioned resource talks about foreclosure scams to be aware of.
In summary, these are just a few steps to follow in order to stop a foreclosure. For more information visit http://www.HelpStopTheForeclosure.com. It's an excellent resource that provides additional ways to protect your home.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
Website: http://www.MaxCapLLC.com/
1 - Do Not Ignore Your Lender or the Problem. Your success rate to stop or protect yourself from foreclosure drastically decreases as time passes. Your lender is more willing to work with you in the beginning stages of the process than if you wait only weeks prior to the foreclosure sale.
2 - Contact Your Lender Immediately. In fact, at the very first sign of trouble—before you are late—you should contact your lender and begin discussing your options. Remember, foreclosure doesn’t happen overnight. Every homeowner knows well in advance if keeping up with future mortgage payments will be a problem. In reality, lenders do not want your home no more than you want to give it up. They would rather you pay the mortgage on time, allowing them to recoup their investment. Consequently, they provide several options for defaulting homeowners.
3 - Stay in Touch with Your Lender throughout the Entire Process. In addition to not ignoring your lender or the problem, stay in step with every correspondence you receive. In other words, open and respond to any and all mail from your lender. Because foreclosure law requires actual notice, the lender’s initial communication will have very important information such as contact information, amounts to reinstate your loan, and timeframes. Oftentimes, homeowners will discard correspondences from the lender because it is mixed in with private companies selling their foreclosure help services. Take the time to review what is and what isn’t from your lender.
4 - Know Your Foreclosure Rights and Options. Do not rely solely on your lender to inform you of your rights or options. Although you must work with your lender, their interest is not to protect you. There is a lot of valuable information relating to foreclosure prevention online. One of them I recommend is http://www.HelpStopTheForeclosure.com. It's a rare resource that offers proven techniques to stop a foreclosure and protect the homeowner.
5 - Use Your Assets to Your Advantage. If the problem causing you to be in foreclosure was temporary, then use your assets to the best of your ability. For example, you lost your job but are now employed and can resume making mortgage payments. Think of assets you can liquidate or sell for cash to help reinstate your loan. Perhaps, some examples are jewelry, a second vehicle, a life insurance policy, a retirement account, furniture, antiques or other collectibles etc.
6 - Avoid Companies that Charge Money to Stop Foreclosure. Stopping a foreclosure is something you can do yourself. Because actual notice is given to the public during the foreclosure process, you will receive many mailings from companies and private investors claiming to have the magic pill for your situation. Although they may be legitimate companies, do not fall for the tricks. Perhaps, those options will work for you. However, you will give up something—usually cash or equity—in order to do what you can do yourself. The above mentioned resource talks about foreclosure scams to be aware of.
In summary, these are just a few steps to follow in order to stop a foreclosure. For more information visit http://www.HelpStopTheForeclosure.com. It's an excellent resource that provides additional ways to protect your home.
CP Howard is the co-founder of MaxCap Realty, which is a real estate company assisting buyers and sellers with brokerage, consulting, and investment services. He is a licensed real estate broker, consultant, mentor, and teacher in real estate and finance, as well as an REO Broker in the St. Louis metro area.
Website: http://www.MaxCapLLC.com/
Wednesday, August 5, 2009
4 Common Ways to Stop Foreclosure
There are a number of ways homeowners can stop a foreclosure. Consequently, it's ludicrous for people to continue thinking that losing their home is completely unavoidable and the only option because it's not. A little information and motivation can go along way.
First, there are no magical solutions to stopping a foreclosure. Second, what's presented in this article is not an exhaustive list--only the most common options for homeowners who want to keep their home. And third, avoiding your lender is absolutely the worst thing you can do. Let’s begin with a few options that will help stop a foreclosure:
1. Re-Negotiating the Loan - This option to stop foreclosure requires the homeowner to borrow against their equity in order to pay the past due amount. Oftentimes, your monthly mortgage payment is less than before, but it all depends on the terms of your loan. In most cases, refinancing is not an option because lenders typically will not refinance a loan that's not current. However, always verify with your lender. Perhaps, they are offering a special program at the time.
2. Loan Modification - This option to stop foreclosure allows you to change the terms of your loan. For example, taking the past due amount and merging it with your existing loan, adjusting your interest rate, adjusting other loan terms, or changing your monthly mortgage payment are examples of modifying the terms of your loan. Modifications are changes that are made to your loan without having to refinance.
3. Developing a Payment Plan - Requesting a repayment schedule to stop a foreclosure involves creating a new payment schedule whereby you continue making your regular monthly payments plus a little extra on the amount that is past due. The payment plan is usually for a specified amount of time from several months to several years.
4. Forbearance - When a bank grants forbearance to the homeowner, which is another option to help stop foreclosures, it temporarily suspends your monthly mortgage payment. The lender grants this if theirs the ability to increase your payment at some time in the future when you are financially stable. The increased amount is usually a portion of the past due amount. This is beneficial for you and the lender because it stops the foreclosure as well as allows the lender to collect delinquent payments over a period of time, instead of demanding full payment at the time of delinquency.
In summary, these are just a few common options to stop a foreclosure from occurring. For more information, CP Howard recommends http://www.HelpStopTheForeclosure.com/. It's a rare resource that offers other proven techniques to stop a foreclosure in its tracks.
Website: http://www.MaxCapLLC.com/
First, there are no magical solutions to stopping a foreclosure. Second, what's presented in this article is not an exhaustive list--only the most common options for homeowners who want to keep their home. And third, avoiding your lender is absolutely the worst thing you can do. Let’s begin with a few options that will help stop a foreclosure:
1. Re-Negotiating the Loan - This option to stop foreclosure requires the homeowner to borrow against their equity in order to pay the past due amount. Oftentimes, your monthly mortgage payment is less than before, but it all depends on the terms of your loan. In most cases, refinancing is not an option because lenders typically will not refinance a loan that's not current. However, always verify with your lender. Perhaps, they are offering a special program at the time.
2. Loan Modification - This option to stop foreclosure allows you to change the terms of your loan. For example, taking the past due amount and merging it with your existing loan, adjusting your interest rate, adjusting other loan terms, or changing your monthly mortgage payment are examples of modifying the terms of your loan. Modifications are changes that are made to your loan without having to refinance.
3. Developing a Payment Plan - Requesting a repayment schedule to stop a foreclosure involves creating a new payment schedule whereby you continue making your regular monthly payments plus a little extra on the amount that is past due. The payment plan is usually for a specified amount of time from several months to several years.
4. Forbearance - When a bank grants forbearance to the homeowner, which is another option to help stop foreclosures, it temporarily suspends your monthly mortgage payment. The lender grants this if theirs the ability to increase your payment at some time in the future when you are financially stable. The increased amount is usually a portion of the past due amount. This is beneficial for you and the lender because it stops the foreclosure as well as allows the lender to collect delinquent payments over a period of time, instead of demanding full payment at the time of delinquency.
In summary, these are just a few common options to stop a foreclosure from occurring. For more information, CP Howard recommends http://www.HelpStopTheForeclosure.com/. It's a rare resource that offers other proven techniques to stop a foreclosure in its tracks.
Website: http://www.MaxCapLLC.com/
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