Business & Finance Finance

Preventing Foreclosure: Stopping A Bad Situation Before It Gets Worse

When a homeowner first realizes that they could be faced with foreclosure of their home it is very understandable that they will be unhappy about it. A person might understandably become convinced that there is nothing that anyone can do in the way of preventing foreclosure.

Preventing foreclosure is, however, feasible by following just a few foreclosure stopping techniques. There are a few critical steps that anyone in a messy financial situation needs to carry out in order to save their home from an unwanted foreclosure.

One foreclosure stopping method to think about is to advertise for an investor who is willing to buy your home for at least the amount you owe. This would relieve you of the burden of the loan without further damaging your credit. Depending on how much you owe, this could be hard to do because the large number of distressed properties means that investors can find great deals elsewhere.

That is where the 'Short Sale' comes in as a viable foreclosure stopping tactic. In a short sale, once you have an investor's offer to purchase, you would submit the offer to your lender. If the lender approves, you could then walk away from the home. When the homeowner is not accepted for loan modification and is destined to lose their home, a short sale is a good method of preventing foreclosure. The homeowner will still have to move, but they depart without owing any more on the home. Their credit score is dinged by about 100 points, compared to an average drop of 250 points in the case of a foreclosure and subsequent sheriff's sale. If the house is foreclosed, the home owner may still owe the difference between the sale price and the amount owed to the lender.

If you are unable to effect a sale to an investor, a variation of this can be done involving just you and the bank. In this case, a Deed in Lieu of Foreclosure is issued and the bank will take possession of your home in exchange for you walking away from the home and leaving it in good condition.

Short sales and Deeds in Lieu of Foreclosure will both have a negative impact on your credit. Generally, this will last for about two years instead of five or more years for a foreclosure.

Another foreclosure stopping method is to negotiate either a forebearance agreement or a loan modification agreement with your banker. Depending on the specifics of your situation, it may be possible for you to work out an agreement with your lender that will permit you to stay in your home. The lenders currently have a lot at stake in preventing foreclosure. Hundreds of thousands of bank owned homes are sitting vacant. They represent liabilities, not assets, to the lenders.

Also, both federal and state government agencies are providing the lenders incentives, and pressuring them to approve loan modifications. If you are falling behind on your ability to pay your mortgage, contact your banker and find out what can be worked out. You will find that lenders are more receptive now than they once were.

As a homeowner interested in preventing foreclosure, be assured that you are not alone. 1 out of every 100 borrowers are in trouble with their mortgage payments. Millions of people have already lost their homes. And, while some of them have been fortunate enough to have found suitable rental homes or shared accomodations with friends, many have become homeless. So clearly, preventing foreclosure should be a priority for everyone.

The high rate of foreclosures is also an important issue for our nation as a whole. From a social perspective, most Americans have a basic concern that people are properly housed. And from an economic viewpoint, the current banking and housing crises are affecting people from all walks of life. To the relief of many troubled homeowners, Government is becoming more proactive with their efforts in preventing foreclosure.

If your home is at risk, it is important for you to educate yourself on these foreclosure stopping strategies.
SHARE
RELATED POSTS on "Business & Finance"
Secrets Of The Stochastic Oscillator
Secrets Of The Stochastic Oscillator
What Are Residential Bridge Loans?
What Are Residential Bridge Loans?
Bankruptcy And Divorce
Bankruptcy And Divorce
Get Better At Forex With These Tips
Get Better At Forex With These Tips
Kids using Parents Credit Cards Online
Kids using Parents Credit Cards Online
Reevaluate A Cash Advance To Pay Taxes
Reevaluate A Cash Advance To Pay Taxes
Don't Let Your Employer Keep You From Getting Workers Compensation
Don't Let Your Employer Keep You From Getting Workers Compensation
Jain Heights Grand West Tasteful Dwellings
Jain Heights Grand West Tasteful Dwellings
What Makes Penny Stock Prophet Amazing
What Makes Penny Stock Prophet Amazing
Pros and Cons of Net Banking
Pros and Cons of Net Banking
Why You Need to Create a Personal Budget?
Why You Need to Create a Personal Budget?
Fantastic Coupon Guidance That May Function For You Personally!
Fantastic Coupon Guidance That May Function For You Personally!
More Money - 10 Money Saving Tips
More Money - 10 Money Saving Tips
Importance of QuickBooks for Its Better Use
Importance of QuickBooks for Its Better Use
The Best Way to Ascertain If You Need to Have Bookkeeping Help or QuickBooks Help For Your Small Bus
The Best Way to Ascertain If You Need to Have Bookkeeping Help or QuickBooks Help For Your Small Bus
People Involved in Consolidating Student Loans
People Involved in Consolidating Student Loans
Is Bad Credit Auto Financing Available In Platte Woods, MO These Days?
Is Bad Credit Auto Financing Available In Platte Woods, MO These Days?
The Lowdown On Student Loans
The Lowdown On Student Loans
Can You Afford The Homes For Sale Minnesota Offers?
Can You Afford The Homes For Sale Minnesota Offers?
Construction Factoring Helps Contractors Stay Profitable
Construction Factoring Helps Contractors Stay Profitable

Leave Your Reply

*