Foreclosure Prevention is Possible with Help from Your Lender

There are many reasons homeowners find themselves facing foreclosure. They might experience job loss, death, divorce, prolonged illness, immediate relocation or find that they just cannot keep up with monthly bills. Regardless of the circumstances, foreclosure prevention, with little effort is possible. Foreclosure can occur when payments become three to four or more months late, depending on the mortgage terms.

If a homeowner is unable to make their mortgage payment, they must contact their mortgage lender immediately. Mortgage companies want to help homeowners avoid foreclosure. Based on the situation, the lender may be able to provide the foreclosure prevention that the homeowner needs.

It is important that a homeowner does not ignore mail from the lender. These letters provide them with important information explaining what to do if they are having trouble making payments. The letters will typically include phone numbers and contact names so that the homeowner can get assistance and discuss their payment issues with a lender representative. Avoiding a problem such as 'nonpayment' will only makes matters worse.

If a homeowner is unable to make their mortgage payment:

They must not ignore the problem

They should contact their lender as soon as they realize that they have a problem

They must open and respond to all mail from their lender

They should know their mortgage rights

They must understand foreclosure prevention options

If a homeowner is having trouble making mortgage payments and fear foreclosure, there are other options to consider. Foreclosure prevention is possible.

Special forbearance. The special forbearance is something that may be arranged by the lender. The homeowner receives a payment schedule adjustment and may receive a suspension of payments for a certain period of time. The mortgage representative will discuss options with the homeowner and after reviewing their situation decide if a special forbearance is warranted.

Mortgage loan modification. The homeowner has the option to extend the loan period or refinance their current loan to get a lower rate and therefore have lower monthly payments.

Repayment Plan. If the homeowner is behind on payments, the lender may give a fixed amount of time to catch up by combining a portion of your past due amounts with regular payments, allowing the homeowner to get current.

Partial Claim. This is available to those individuals who have HUD loans. With this payment alternative, the Department of Housing and Urban Development would help the homeowner bring their mortgage up to the current balance by paying the money that is overdue.

Selling the home. Some homeowners find that selling their home by way of a pre-foreclosure sale. This allows the person to sell their home for an amount less than the total mortgage amount due prior to having it sold via foreclosure sale.

Short Sale. A deal between the homeowner and lender to sell the property for less than it is worth, with the mortgage lender taking the loss.

Foreclosure is expensive for lenders, mortgage insurers and investors. Foreclosure Prevention is possible because the lenders are required to work aggressively with borrowers who are facing money problems. Lenders have options to work through the prevention of foreclosures. It is important that homeowners do not assume that their mortgage problem will quickly correct itself. However, there are no guarantees that any particular relief will be given, but most lenders are willing to explore every possible option for foreclosure prevention.

About Home Affordable Guide

Marci Berlin is a freelance writer who lives in Farmington Hills, Michigan with her husband and three children.

The Home Affordable Guide was created in 2009 by a team specializing in helping homeowners navigate through all government and in-house mortgage help programs. The Guide was designed to simplify and educate homeowners through the entire process of applying for a loan modification or short sale in five easy steps. To learn more about how the software can help your business, please visit: www.homeaffordableguide.com/take-a-tour/