10 Steps to Fight Foreclosure
1. ACT Now!
The biggest mistake is to do nothing until it is too late.
Don’t give up the fight before the foreclosure has even
begun! There is nothing more humiliating than a forcible eviction
from your home.
Remember that in a foreclosure, the lender
adds interest, penalties, legal fees and court cost to the
balance you owe. The longer you wait, the more expensive it
gets!
2. Keep your Emotions in Check
The threat of losing your home is serious. But try to think
of it as “bricks and mortar”. It is better to
give up a home you can no longer afford, and to preserve your
equity and credit rating.
3. Don’t Be the Victim
of a Scam
Foreclosure records are public. Once your home is in foreclosure,
a horde of scam artists will contact you. Their goal is to
take away your hard-earned equity.
Our advice: Never deed your property interest
over to a complete stranger simply in an attempt to stop foreclosure.
4. Try to Work out an Agreement
with Your Lender
Lenders want to have a few mortgage delinquencies as possible.
It makes them look bad, and costs time and money. Lenders
are interested in negotiating a payment plant with you.
5. Keep Your Taxes and Insurance
Current
If you don’t pay your homeowner’s insurance, the
lender will insure the home to protect their interest only.
If the house should burn down, the lender is covered, but
you loose everything. Pay your taxes or set aside savings
to pay your taxes.
6. Refinance
You may be able to refinance your mortgage with a mortgage
program designed for borrowers with credit problems, but beware
of loan predators! Be careful to work with a reputable
mortgage broker or lender.
7. Selling Your Home
It is often better to sell your home to preserve as much of
your equity and good credit as possible. But don’t fall
for real estate opportunists who are mostly trying to profit
from your troubles. List your home with a reputable
realtor.
8. Considering Bankruptcy
It is a common miss-conception that your home is protected
in a bankruptcy. If your home is in foreclosure, you will
be contacted by lots of attorneys promising you an easy solution.
Don’t fall for these promises! It is very important
to work with a reputable
attorney who will honestly tell you whether a bankruptcy
is best for you.
9. If all else fails, walk away
gracefully
There is nothing more humiliating than a homeowner and their
property being thrown out on the street. If you have exhausted
all other alternatives, contact the lender or attorney and
ask if they are willing to pay you to leave the home in an
orderly and clean condition. This will help to secure a rental
and pay for a licensed and insured mover.
10. Life after Foreclosure
While it may be difficult to re-establish your credit right
after a foreclosure, you will be able to buy a car, a home,
and get a credit card after a while. Just keep in mind that
will charge higher fees and interest rates. You can get financing
from reputable sub-prime lenders to buy a home or car as long
as your credit history after the foreclosure is clean.
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