How to Halt the Foreclosure Process

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Does a Notice of Default Mean My Home is Lost?

Even though the economy has improved a bit over the last few years, there are still families that are struggling to make ends meet. Missing several mortgage payments will lead to your lender filing a Notice of Default. Receiving an NOD can cause a panic since many homeowners take this notice to mean their house is a lost cause. That is where they are wrong.

There are still measures that owners can take to save their home from foreclosure.

Saving Your Home from Foreclosure

Bankruptcy

Filing for bankruptcy will stop the foreclosure process immediately. This is due to a federal law prohibiting debt collectors from continuing collection activity, a foreclosure is considered a collection activity in this case. Once you are in court, the bankruptcy trustee will be the mediator between you and the creditor. Ultimately, you will have to pay your creditor but bankruptcy buys you more time to either save up your money or find another job. Bankruptcy also aids in creating a reasonable payment plan.

Change the Terms of Your Loan

Some mortgages come with an adjustable loan that enables a lender to prevent an increase or change the rate so that is more manageable. If your lender will not change the terms of your loan then you may need to seek out a home loan modification. A loan modification will decrease both your interest rate and monthly payment along with waiving late fees. Loan modifications can also be done during bankruptcy, be sure to ask your bankruptcy mediator about it.

Short Sale

If your home is worth less than the amount you owe your lender, then it is time to let your home go. A short sale is better than a foreclosure and mortgage lenders often prefer it over foreclosing on your home, the sale is actually better for the owner as well.

Since the lender will have to sell your home after foreclosing, a short sale is appealing since it will save them the aggravation of doing it themselves.

Home Loan Modifications

At USA Modification, we are in the business of helping homeowners save their home through home loan modifications. If you are unsure if you qualify for a loan modification or want to learn more, then please gives us a call at 888.850.7075. We offer free consultations.