Tips On Avoiding Home Foreclosure
If you have fallen into serious financial trouble and are having difficulty making your home mortgage payments, it is crucial to focus on how to avoid having your property go into foreclosure. Hiring a foreclosure lawyer
will make the process of avoiding foreclosure easier to bare.
is a long process, not a singular event that happens in a short period of time. Because there are multiple steps in the foreclosure process, ample opportunity exists to try and avoid foreclosure even as the process is set into motion.
Recognizing Risk Factors for Foreclosure
The first step for a homeowner to avoid foreclosure
is to recognize the risk factors.
Several warning indicators for potential foreclosure are listed below:
How a Foreclosure Progresses
- Difficultly paying utility bills and other expenses in a timely manner
- Accumulating credit card debt
- Reliance on credit cards for day-to-day expenses that previously never would have been paid by using credit
- Changes in financial situation due to divorce, job loss, tax increase, investment losses, illness or increase in mortgage interest rates
The process, progression and timeline of a foreclosure will vary from state to state, which is why it is important to talk with an experienced local real estate attorney
as soon as possible. He or she will be able to help you identify where you are in the process and the steps to avoid completion of the foreclosure.
In general, a foreclosure might progress like this:
Final Stages of Foreclosure
- First missed mortgage payment. You will receive a written notice of missed payment or may get a phone call from a lender. Because it is so early in the process, you have ample opportunity to seek expert advice on how to get back on top of paying off your mortgage loans.
- Second consecutive missed mortgage payment. At this point, you must make the concerted effort to contact your lender and explain your reason for late or missed payments. Ask your attorney for advice on how to negotiate a payment plan to avoid going another month without payment.
- Third missed mortgage payment. Expect to see a “demand letter” from your lender informing you that you are delinquent on your home mortgage loan. Dependent upon the foreclosure laws of your state, you will likely be given 30 days to settle the back payment due on your mortgage.
At the conclusion of the 30 days referenced in your letter of demand, you will likely be referred to your lender’s attorneys.
Beyond this point, the attorney for the lender will work with the local sheriff or third-party trustee to schedule a public sale. This represents the final stages of foreclosure. Do not give up, simply because it has gotten to this point. It is still possible to make payment arrangements until the actual date of the sale.
If you recognize that you are headed for foreclosure or are at any stage of the process, it is vital to be proactive about the situation.
A few tips on how to handle a home mortgage crisis and work to avoid foreclosure are listed below:
- Acknowledge the problem. Do not ignore your home mortgage situation, or kid yourself about the seriousness of falling behind in mortgage loan payments.
- Take action immediately. As soon as you recognize a problem, contact your lender to discuss the circumstances and begin working on a payment plan.
- Pay attention to mail and phone notices from your lenders.
- Gather all documents that are related to your mortgage and consult a local real estate attorney to give you personalized assistance in the foreclosure process.
The U.S. Department of Housing and Urban Development can provide important information about foreclosure laws, mortgage rates and protecting yourself from foreclosure recovery scams.