If you are facing foreclosure, you're not alone. Foreclosure rates are skyrocketing across the country due to falling home values and resetting adjustable rate mortgages. This month, we're detailing different options for homeowners in crisis.
Look to Your Own Finances - Take a close look at your current financial situation to see if there is a way you can get your mortgage back on track on your own. Can you cut back on expenses? Take on a roommate? Work overtime? Your may want to talk to a financial advisor or credit counselor about creating a realistic monthly budget.
Stop Foreclosure Option - If you find that you would be able to afford your minimum mortgage payment and want to stop the foreclosure proceedings, talk to our partner Stop Foreclosure Option. These loss mitigation experts can help bring your mortgage current and get you back on track.
Refinance Your Mortgage - Unfortunately, refinancing isn't an option for many borrowers today. You'll have the best chance if you have a good credit score and your home hasn't depreciated. You can apply for a free mortgage refinance quote online to evaluate your options.
Talk to Your Lender - Lenders don't want you to foreclose either. Taking over your home loses them a lot of money and costs them a lot of time. Talk to your lender at the first sign of danger to see what options they might offer.
Counseling Options - Foreclosure counselors are springing up all over the place, some are authentic and others are scammers. You need to be careful. The U.S. Department of Housing and Urban Development has a list of approved housing counselors online. HOPE Now is a new government program designed to help consumers avoid foreclosure.
Short Sale - A short sale is when your lender agrees to sell the home at a reduced price to a buyer and forgive the difference. This can be a complicated process and depends on your lender's policies. You will have to pay taxes on the forgiven loan amount and the short sale record will damage your credit - same as a foreclosure - for 7 years. If you are interested in a short sale, talk to your lender to see if it is an option.
Bankruptcy - You may be able to keep your home by filing for bankruptcy. Talk to a local bankruptcy attorney to see if this is a viable option for your situation. Bankruptcy will damage your credit for 7-10 years.
Foreclosure - Sometimes, there are no solutions aside from foreclosure. If you are in this situation, it is important to understand how the process works and your legal rights. Our consumer law expert has posted a detailed article for those entering into foreclosure. Foreclosure will damage your credit for 7 years and will make it very hard for you to get a new mortgage in the future.
Are you facing foreclosure? Share your story with our team of financial experts at tidbits@credit.com.
Quote of the Month
"When summer gathers up her robes of glory,
And, like a dream, glides away."
- Sarah Helen Whitman
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