Alternatives to Foreclosure
If you are a homeowner who has fallen behind on your mortgage payments, foreclosure is not your only option. There are foreclosure prevention options – known as “workouts” – that allow you to retain ownership of your home. By working together with your lender, you may be able to find an alternative to foreclosure. Below are some workout options for retaining your home.
Workouts to Stay in Your Home
Refinance: pay off your existing mortgage loan with the proceeds from a new loan.
Forbearance Plan: allows the suspension of all or part of your monthly payment for a specified time period, based on lender agreement.
Repayment Plan: catch up on missed payments by paying more than one full payment per month until your account is brought current.
Loan Modification: allows changes to the original terms of your promissory note which may include any combination of the following: an adjustment to your interest rate; an extension of the term of your loan; or an increase in your loan amount by the amount past due.
Take the mortgage options assessment.
Workouts When Homeownership Is No Longer An Option:
Short Sale: occurs when a property is sold and the lender agrees to accept a discounted payoff, meaning the lender will release the lien secured to the property upon receipt of less money than is actually owed.
Deed-in-Lieu of Foreclosure: allows the transfer of a property to the lender without going through the foreclosure process. This is usually a “last resort” option and may follow other options such as an attempt to sell the property.
