If you’re facing foreclosure, the good news is that there are some alternatives you can consider. These options may give you the opportunity to save your home and to prevent the damage to your credit rating that a foreclosure can cause.
The foreclosure process generally begins after you miss several payments on your mortgage. The lender uses foreclosure to take legal possession of your home. This means that you lose all the money you put into your home, and you may lose your home completely. Typically, foreclosure properties are sold at auction.
There are some alternatives available to those struggling to pay their mortgages. For example, if you have a mortgage that is too high, you may be able to seek a modification. If you have lost your job or fallen ill, then a special forbearance period might give you the time you need to pay what you owe. Sometimes, the special forbearance period lowers the amount that you owe or suspends payments for a time.
If you think that you can sell your home and avoid going through the foreclosure process, a pre-foreclosure sale might be an option. A short sale, as it’s also known, gives you the chance to sell your home for less than the mortgage, but only if that move is approved by your mortgage lender.
As you can see, there are multiple ways that you can try to save your home or prevent damage to your credit report. With the right legal help, you can make a good decision on what to do about a looming foreclosure.