Nothing can make your heart sink lower than receiving a letter stating that the sender will be confiscating the property you’ve given as security for the payment of a loan. If you’re behind on your mortgage installments, you may lose your home unless you take the necessary steps to prevent it. First, you either pay up or move out.
If not, you need to know how to avoid foreclosure. Not many people realize that, when faced with such a possibility, there are options. In the absence of immediate payment, you’ll need an attorney who’s an expert in dealing with this kind of crisis. Here are other things that you can take up with legal counsel.
Forbearance
This allows one to have a momentary postponement of the installments. It allows you to get additional time to postpone the issues that are causing your inability to come up with the payments. In many cases in the past two years, forbearance was acceptable in the face of the pandemic that economically ravaged the country.
Mind you, this doesn’t wipe out the balance. Payments will once again have to be made after the period given. You can discuss with the lawyer what possible reasons there are in your arsenal to justify a forbearance. After that, you’ll need to pay a lump sum and offer a restructured payment scheme until the debt is settled.
Loan Modification
The revision of a mortgage enables the borrower to catch up on overdue installments through a practical plan that benefits both the lender and the debtor. To come up with such an arrangement, you’ll need the help of an expert. For those who live in the area, there’s a Baltimore foreclosure lawyer you can consult.
A common loan modification is one that extends the schedule, lowers the lending rate, and adds back to the principal balance the unpaid installments, sans interest. Take note: you may be paying less in installments, but the total payment will add up to a larger amount. This may just be a proposition that a creditor wants.
Refinancing
This is similar to a loan modification that revises the terms of an existing loan. The only difference, in this case, is that a borrower seeks to refinance when interest rates fall. It becomes advantageous for the person to take this course of action. One can even increase the value of the package to cover outstanding amounts and also renegotiate to include a third party.
Sell the House
A sure way to put an end to the problem of foreclosure is to put your home on the market. The only thing that’s needed to make it a reasonable solution is for the property to be worth more than what you’re paying for. If that’s not the case, it’ll be considered a short sale and may not be the best way to go. The lender will have to approve the transaction, and your buyer will have to agree to the deal.
If All Else Fails…
The best way to stop a foreclosure dead in its tracks is to file for bankruptcy. Once that’s done, an automatic stay takes effect, which prevents the bank from confiscating your property. Even if the creditor succeeds in its filing of a motion for relief, the foreclosure will take a month to two months to get back on track, and this delay can buy you time to look at other options with your bankruptcy attorney.
How to Avoid Foreclosure
Pay attention to the problem you’re facing. Get in touch with the lender ASAP. Answer all related emails related to the issue. Know your mortgage rights by going over them with a lawyer. Lastly, make a proposition that’s based on the options mentioned above.
It cannot be stressed enough how important it is to talk to a legal expert on foreclosure. This attorney knows the laws that can be channeled for your defense. If you haven’t heard of Richard Hackerman yet, he’s the one to see. You can call him toll-free at 888-243-5500 or 410-243-8800. You can also fill out our contact form for more information.
