Are you struggling to pay your mortgage? Do you want to avoid foreclosure but don’t know how? These are common questions many homeowners ask themselves when they feel the pressure of having too much debt. For those who do not know, there are several steps one should take before getting behind on their mortgage payment to avoid foreclosure. This article will discuss helpful tips to help you stay afloat and prevent this unfortunate situation.
Organize Your Financial Information
Organize your financial information into a binder or file folder. You will need to provide this documentation for the servicer to help you with your situation. If it is not organized, they may have more difficulty helping you, which means you could lose any chance of avoiding foreclosure. A good idea would also be to keep copies of all payment receipts and statements as these items are essential too.
Have a Foreclosure Lawyer
If you have already missed mortgage payments in Michigan and the foreclosure process has begun, it is best to contact a foreclosure lawyer. This Commerce Township based Foreclosure Lawyer specializes in this area of law and can help homeowners understand their rights and what options are available to them. They may be able to negotiate with the servicer on your behalf or even file a lawsuit if needed.
Contact a HUD-Approved Housing Counselor
A HUD-approved housing counselor is an excellent resource for struggling to pay their mortgage and want to avoid foreclosure. These counselors have been through training that allows them to help homeowners stay afloat during rough times so they can get back on track with payments before it’s too late.
Know Your Rights
It is essential to be aware of your rights as a homeowner. Several federal and state laws offer protection for those struggling with their mortgage payments. It is crucial to know what they are. For example, you may have the right to request a loan modification or forbearance, which will help postpone or reduce your monthly payment for a specific amount of time.
Apply for a Loan Modification
If you cannot make your current monthly mortgage payment, applying for a loan modification may be your best option. This process will allow you to have your mortgage payment lowered to be more affordable for you. Keep in mind that there is no guarantee that the servicer will approve your request, but it is worth a try.
Avoid Default
If you struggle with your mortgage payment and want to avoid foreclosure, you mustn’t default. Once a homeowner defaults on their loan, the servicer will give them 30 days before initiating legal proceedings such as foreclosure. It is best never to miss even one mortgage payment because this can happen instantly. If you need help with late or missed payments, there may be options available so contact your servicer immediately for assistance if required.
Understand Foreclosure Prevention Options
There are foreclosure prevention options available for those who qualify. These options will allow you to postpone or even stop your foreclosure, depending on what program is offered and if they fit your specific situation. These programs include the Making Home Affordable Plan (HAMP) and HARP, which provide loan modifications to help homeowners avoid foreclosure. Only certain conditions must be met to qualify.
Stay Informed
The best way to avoid foreclosure is to stay informed. Keep track of your mortgage and payment status and what programs are available to you. It will help you understand where you currently stand with your payments and take any steps to avoid losing your home.
Sell Your Assets
In some cases, it may be necessary to sell your assets to catch up on your mortgage payments. It can include selling cars, furniture, or any other belongings you may have. It is essential to remember that this should only be a last resort option and not something done lightly.
Have a Budget
If you struggle to make your monthly mortgage payment, it is vital to have a budget. It will help you keep track of your spending and see where there may be areas to cut back and allocate more money towards your mortgage. It is also helpful to create a savings account specifically for housing expenses to save money in case of an emergency.
In summary, if you are struggling to make your mortgage payment, there are several things you can do to avoid foreclosure. These include applying for a loan modification, avoiding default, hiring a foreclosure lawyer, and understanding the different foreclosure prevention options available to you. It is also essential to stay informed about your current situation and what programs may help you. Finally, selling assets and creating a budget may also be necessary steps to keep your home.
