7 ACTION STEPS TO TAKE WHEN FACING A FORECLOSURE

 

1. Gather your loan documents and set up a case file.

Before you miss a mortgage payment or if you’re already behind on your payments, the first thing you should do is get organized. Set up a file for the records that relate to your home and put important documents in that file.

You’ll want to include your loan documents, such as copies of the mortgage (or deed of trust) and the promissory note. You should also include:

  • your monthly billing statements
  • a record of the payments you’ve made
  • escrow statements (if applicable)
  • property tax information
  • insurance information
  • any correspondence from your servicer, and
  • copies of any letters you sent to the servicer.

2. Learn about your legal rights.

Once you’ve gathered your documents, take the time to actually read them so you know what will happen when you don’t make your payments. The mortgage (or deed of trust) and the promissory note will contain important information such as:

  • whether you can reinstate the loan by catching up on the past-due amounts (state law might also provide a right to reinstate)
  • the monthly late charge amount, and
  • what other kinds of fees the servicer can charge when you fall behind in payments.

Under federal law, in most cases, the lender can’t start a foreclosure until you’re over 120 days delinquent in payments.

3. Organize your financial information.

Along with the loan documents, you should gather and organize your financial information. Collect your recent pay stubs or a profit and loss statement if you’re self-employed, bank statements, federal tax return, and supporting documentation for any other income you receive, like Social Security, rental income, and alimony. You should also figure out your total monthly income (including your monthly gross wages, overtime, self-employment income, unemployment income, Social Security, child support, and alimony), and your monthly expenses (including your mortgage payments, credit card payments, car payments, student loan payments, food, entertainment, utilities, HOA/condo fees, etc.)

4. Know your options.

Often, borrowers have access to permanent or temporary loss mitigation options to help them avoid a foreclosure. Here are just a few possibilities:

Loan modification. A loan modification is a permanent change to your loan terms. For example, a modification might extend the amount of time you have to pay off the loan or reduce the interest rate. With a loan modification, the servicer can often add any past-due amounts to the balance of your loan. Depending on your circumstances, you might qualify for a Fannie Mae or Freddie Mac Flex Modification or a proprietary (in-house) loan modification.

Forbearance agreements and repayment plans. If the reason you’re unable to make your monthly payments is temporary, you might be eligible for a forbearance agreement. With a forbearance agreement, the lender agrees to reduce or suspend the payments for a certain period of time. At the end of the forbearance period, you bring the loan current by paying back the missed or reduced payments in full, through a repayment program, or through a modification.

5.  Call your servicer.

Don’t wait until the last minute to seek help. If possible, call your servicer as soon as you miss a payment (or think you might miss a payment) to find out if you qualify for a foreclosure alternative. The sooner you deal with the problem, the better.

6.  Sell the home before the foreclosure sale.

For this option, keep in mind it can be a long process.  You will need time to make the property “market ready”, find a buyer and close.  This process can take up to 45 to 60 days. 

7.  CONTACT REAL ESTATE HELP CENTER!

If you have exhausted all options and/or you would like assistance upon receiving your Notice of Default, CONTACT Real Estate Help Center.  We will discuss the best solution as determined by you with our assistance.  DO NOT lose all of your equity.  And last but not least, this is a very difficult time for you and your family, many have walked this same path, just remember and take comfort in the fact that…This Too Shall Pass.  

If you would like assistance in order to stop your foreclosure and to save your equity, contact us.  Real Estate Help Center is here to help! Please click the link below for more information.

https://realestatehelpcenters.com/

We look forward to helping you find the right solution for you and your family. Do not delay, as the clock is ticking!

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