The thought of having a home foreclosed is a terrifying image. It represents the loss of equity and also your home. The process of entering into foreclosure means a borrower has failed to adhere to the terms their lender set forth. Ideally, a homeowner would want to avoid foreclosure and try to make any other viable arrangement. There are several other options besides foreclosure.
No one wants to borrow money from his or her parents, but home foreclosure could be the exceptional reason to consider asking for assistance. If you have family and friends with available money to lend toward avoiding foreclosure, you should take the opportunity to explain your situation and ask for help. Because a default in mortgage payments is the number one reason for foreclosure, asking for financial assistance is a viable option to foreclosure.
- Liquidate Assets
If you have other real estate, consider selling it immediately to fund your mortgage solvency plans. Any money that is being put away in a savings account needs to be tapped to avoid moving further into foreclosure.
- A Friendly Foreclosure
Friendly foreclosure is the alternative to a typical foreclosure. Where a normal foreclosure is a fight between borrower and lender for control over a home loan, a friendly foreclosure is where the borrower acquiesces to the terms of the agreement presented by the lender. You agree with the bank and submit to the term of the foreclosure, and the bank halts further fees and surcharges.
If you are considering bankruptcy, you should secure the assistance of a legal advisor. A bankruptcy can be very detrimental to your financial health. Bankruptcies are all different, and while it may not stop a foreclosure, it can slow the process to give you time to explore your options.
The mortgage lender does not want the house they helped purchase house. They want the money owed to the on the purchase of a home. It’s to the benefit of any lender to seek a settlement or arrangement with the goal of recouping the cost of the money that was lent. Reach out to your financial institution and speak to a loan officer.