Contact a HUD-approved housing counseling agency for free information,. If you have enough cash available, you can reinstate your loan by offsetting all late payments, including principal and interest, plus fees and expenses. State law often gives homeowners a specific amount of time to reintegrate. Once you've lost 3 or more months of payments and are in default or before foreclosure, your options for stopping the foreclosure process will depend on how advanced you are and what your financial situation is.
It's best to talk to your service or about the options as soon as you know you're going to stop paying so they can see what they can do to help you get back to normal and possibly refinance to avoid foreclosure. You can search for a counselor online or call (800) 569-4287 to get started. Victoria Araj is a section editor at Rocket Mortgage and held positions in mortgage banking, public relations and more during her more than 15 years with the company. He has a bachelor's degree in journalism with an emphasis in political science from Michigan State University and a master's degree in public administration from the University of Michigan.
A lawsuit can be expensive and time consuming. Before you file a lawsuit to try to stop a foreclosure, you should evaluate if it's worth it, especially if you haven't been able to afford your mortgage payments. It may be more worthwhile to try to negotiate an extension of the sale with the lender if you think you can catch up with payments, negotiate a deed instead of a foreclosure, or some other option that doesn't harm your long-term credit and finances as much. Founded in 1976, Bankrate has a long history of helping people make smart financial decisions.
We've maintained this reputation for more than four decades by demystifying the financial decision-making process and giving people confidence about what actions to take next. However, if you haven't yet paid by the end of the grace period (usually 10 to 15 days), your mortgage lender has sent you due notices, or you have several overdue mortgage payments, you should act quickly to get your mortgage back in good standing and avoid foreclosure proceedings. A deed instead of a foreclosure involves giving your home to a lender on a voluntary basis to avoid foreclosure proceedings. In some cases, following this path could help you avoid paying off the remaining balance of your mortgage loan, but that depends on the rules of your lender and the state in which you live.
Before you get a deed in lieu of a foreclosure, ask your lender if they will exempt you from any deficit, which is the difference between the value of your home and what you still owe on the mortgage. If there is a deficiency, the lender may seek a judgment to try to collect even after you are out of the house. A short sale could help you recover some of your capital, but the lender must approve it first. A real estate agent with short sales experience could help you find a buyer and guide you through the lengthy process of obtaining the necessary approvals.
The mortgage servicer must also provide a contact person available by phone to answer your questions and provide you with accurate information about your options for avoiding foreclosure. By law, this person must be assigned within 45 days after the date their loan is overdue, according to the Consumer Financial Protection Bureau. A temporary suspension of collection stops your mortgage payments for a while. It does not reduce what you owe, but rather postpones the payment of that amount.
The balance can be deferred until the end of your mortgage or repaid based on a repayment plan or loan modification. .