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How to Avoid Foreclosure - Your Options

February 16, 2012 | Comments: 0 | Views: 132

The foreclosure process can be quite an ordeal for the owner of a house. After being unable to pay mortgage payments for some time, a Notice of Default will be sent to the homeowner. This document will set a date by which the delinquent balance may be paid in order to stop any further proceedings. If the payment is not made, the foreclosure process will continue. The lender may seize the property, hold it for a time and then proceed to sell it in the future or the property may be sold through a public foreclosure auction process. In either case the homeowner will lose all rights to the property.

In order to avoid going through the foreclosure process, one can take several steps and reach out to several different agencies for help. First, the homeowner should never ignore any correspondence from the lending institution. Instead communicate honestly with the lender's agent. Do not simply abandon the home as most programs require the homeowner to remain in the home in order to obtain assistance. Call the federal Department of Housing and speak to one of their counselors who will be able to assist in locating appropriate programs to assist homeowners during times of financial duress. Often, government as well as private and community based programs exist that one can turn to when faced with this situation. There are often alternatives to the foreclosure process. One might not be able to remain in the home but still may be able to pursue some actions that could preserve the credit standing while also alleviating the debt burden that the homeowner can no longer bear. If there has been a new circumstance, such as a serious illness or a drastic change in income, some lenders will work to change the payment plan, perhaps allowing for a few payments to be temporarily skipped or perhaps reducing the payment amount monthly while lengthening the time given to repay the loan.

For a homeowner who has recently recovered from a financial hardship, a refinance or mortgage modification may also be a viable option. The FHA insurance fund can sometimes pay out a partial claim which will pay the past due mortgage amount and issue a lien against the property to be paid when the property is sold or the first mortgage is paid in full. This program works well for someone who simply needs help catching up but will be able to meet his mortgage obligations in the future. One may also be able to sell his home either for enough to pay off the property or for an amount, approved by the lender, which is somewhat less than the amount owed. This short sale will not allow the homeowner to retain the rights to the property, but it will avoid the stigma of having a full foreclosure on one's credit report. There are several programs available today to help the financially troubled homeowner navigate the foreclosure process and help to save the home or the credit rating of the homeowner.

How To Avoid Foreclosure has become a very important topic of discussion these days. provides you with some of the best tips and expert advice which will help you to deal with foreclosures.

Source: EzineArticles
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