A foreclosure is difficult for anyone to go through, but it is an absolute nightmare for those who have done everything they can to prevent the sale of their home. A foreclosure is a legal process where the lender repossesses your home. When this happens, you have no choice but to move out of your property.
In the case that your property is worth more than you owe, there may be a chance that you can sell it and avoid foreclosure. However, if it is worth less than you owe, the lender could pursue a deficiency judgement. This judgment would give the lender the right to pursue the remaining difference from you after the sale of the home.
It is a good idea to talk to you your attorney if you are facing a foreclosure. There may be ways to avoid a deficiency judgment or to be able to have the lender accept the home without seeking the remaining loan amount from you.
What should you do if you miss a mortgage payment?
Typically, it takes more than one missed mortgage payment to threaten your home. If you are going to miss a payment or have missed a payment, it is important to contact your lender immediately. Your lender may have options available to you.
For example, some allow for lower payments for a period of time due to financial hardship. Others may forgive the missed payment and allow you to begin paying again the following month. Without knowing that you are in trouble, there is nothing that the lender can do.
Are there alternatives to foreclosure?
Yes, there are a few different alternatives to foreclosure. These include special forbearances, a temporary reduction or suspension of your payments and the possibility of a short sale. Each one helps you avoid a foreclosure on your credit score, and a few can help you keep your home.
Be cautious when you are dealing with a possible foreclosure. It is common for scam artists to contact those who are in financial trouble. If you are selling your home without guidance or have not yet spoken to your attorney, it is a good idea to wait before you agree to anything with anyone who says they can help you save your home. There are things that can help you save your home and protect your credit score, but not all options are created equal.