Foreclosure is one of the most fearsome things that can happen to you. It happens when you are not able to payback the monthly installments on your mortgage, and the lender, which could be a bank or a mortgage company, seizes and sells your property as per the terms of the mortgage. There are certain ways whereby you can stop foreclosure from happening to you. 

You may have fallen behind on your payments due to various reasons – a loss of a job, an emergency medical expense, or a similar unexpected occurrence. If you miss a credit card payment, it would hurt your credit rating, but miss a mortgage payment and it may be the beginning of a slide that needs to be stopped immediately. 

Confront Foreclosure Head-On
This is the only way you can avoid foreclosure of your property – by meeting it head-on. Tackle your foreclosure problem the moment you receive the first notice from your lender that you are behind in your payments, and are in breach of the mortgage contract. This is the beginning of the pre-foreclosure process. The notice will ask you to make your payments immediately, or they would be forced to foreclose your property.

The banks and the mortgage lenders are in the business of lending money, and not selling properties. What they want are their payments, and are least interested in your property. Do not ignore any notice you receive from them. Mortgage lenders will be ready to sit with you to sort out your re-payment plans. As a matter of fact, one way to stop foreclosure proceedings of any kind is to contact the bank on your own the moment you miss your first mortgage payment. This shows your sincerity in trying to solve your problem, and is one of the best ways to avoid foreclosure. 

You can even pre-empt or stop foreclosure by calling your bank, or your mortgage lender, the moment you sense that you might miss your next mortgage payment. You might be told that nothing can be done unless you missed a payment. Ask the call to be recorded. Call again once you actually miss a payment. Your previous call will show that you did try to get ahead of the situation, and prove your sincerity to solve the problem. 

Work Out Your Mortgage Repayment
Most mortgage lenders, be they the banks or the private lenders, would be happy to work with you to stop foreclosure, if you let them. If you were sincere enough, they would often be willing to make concessions to stop foreclosure of your home. As mentioned earlier, they do not want to be property managers of your home – they only want their money back.

To overcome your temporary financial problems, the mortgage lenders could allow the following:

• Re-instatement – This is when you commit to pay a lump sum, to bring your delayed payments up to the current level, by a specific date.
• Forbearance – Your mortgage lender may allow you to delay your payments for a short duration, with an understanding that you will bring your account to the current level, exercising other options.
• If you know that you can have funds available to bring your mortgage account current by a specific date, your mortgage lender may combine re-instatement and forbearance. 
• Re-payment Plan – If you are, now, in a position to make regular payments, your mortgage lender may allow you to catch up by adding a portion of the missed payments to your current payments, until the account becomes current. 

If your financial problems are long term, you need to be very clear about it with your mortgage lenders. They will approach your problems differently to help stop foreclosure on your property. 

One of the options to avoid foreclosure is modification of your mortgage. Mortgage modifications follow when you are in a position to pay your current installments, but are unable to catch up with the previous missed payments. You may be allowed to add the amount of missed payments to your loan amount. If, on the other hand, you are unable to make payments at the former level, your mortgage lenders may extend the term of your loan, or take other means to reduce your payment. 

Similarly, there are other options available with your mortgage lenders to help you avoid foreclosure on your property, such as ‘deed in lieu of foreclosure,’ FHA loan, and VA loan, etc. 

The key to stop foreclosure on your home is to tackle the problem along with your mortgage lenders. They are always ready to meet you half way, and at times, more than half way, if you allow them to.

 

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