Saturday, October 24, 2009

FORECLOSURE

When you apply for a loan, you will repay in a long time, but you can not be sure that no unfortunately problems which will occurs in the future. And when have face to serious problems such as lost job, divorce with your husband/ wife... You can not repay in time. And you have to face with FORECLOSURE.

To help you prepare for this problem, I will tell you some solutions and the way to avoid the foreclosure.

At first, you need to communicate with your lender and rest assured where foreclosure is concerned, you and your lender are on the same side. Lenders want our money and the interest what comes with it, not your house.And if you seem to be a good risk, the lender will offer to help you to keep your mortgage afloat. But it is forewarned that if you seem like a bad risk, the lender may cut its losses by taking steps to foreclose and evict you as soon as possible.

And the key for this problem is to contact the lender before your debt gets the better of you. The sooner your lender knows of your problem, the more help it can provide.

And the second is the foreclosure spiral, it begins when your loan payment becomes 16 days overdue. At that point, your mortgage servicer will try to contact with you to work out a repayment schedule to bring your loan current.

If your first payment becomes 30 days delinquent and the next month's payment looks doubtful and the collection attempts begin in earnest. If your payments fall 90 days after that, the servicer will likely refer your mortgage to an attorney or other entity that will initiate formal foreclosure proceedings.

And now, I will show you options which your lender may offer if you miss a payment and want to avoid foreclosure:
  • Repayment plan:
If you suffer a short-term financial setback, your lender may provide some breathing room by agreeing to let you pay off your missed payment in two installments over the next two months.
  • Loan modification:
It means your mortgage servicers can adjust the terms of your loan, he will help you to lengthen the amortization schedule, or lower the interest rate or roll the delinquent amount into the loan and reamortize the new balance, it will help you bring the loan current.
  • Short sale:
This solution is the lender allows you to sell the house for less than the outstanding loan amount and takes the proceeds and forgives any remaining debt.
  • Short refinance:
The lender forgives some of your debt and refinances the rest into a new loan.
  • Refinance with a "hard money" loan:
You won't like the high rates and fees of a hard money loan who from a private lender, but it may buy you time to sell your home and avoid foreclosure.

No comments:

Post a Comment