not nearly so prevalent now as it was between 2008 and 2012. CNN reports that between 2014 and 2012, foreclosures have decreased more than 25%. Even so, many home owners are still at risk of foreclosure and bankruptcy. Neither of these events are the end of the world. Freddie Mac reassures families and homeowners that they can eventually rebuild their credit and avoid most permanent ramifications, but even so it’s best to explore other options before you let your house be foreclosed on.
Here are the two most common solutions that may work for you.
Check to See if You Qualify for Deferment or Forbearance
Deferment and forbearance are most commonly associated with student loan repayment plans. However, certain mortgages in particular situations may qualify for similar options. Usually this occurs in situations where national disasters like Hurricane Katrina have struck. But even if your home wasn’t nearly destroyed by a fire, you may be able to receive one. Ideally, you should start preparing a case file that contains your loan information as well as information on your payments. Include the payments you have made as well as any payments you have missed in addition to documentation of your employment or of any current hardships. The lending institution may require that you fill out additional paperwork, but the basic information for a typical unemployment or financial hardship case will be contained in your own files.
Register with a Loan Modification Program
Some lending institutions are not willing to work with their customers. They have very little incentive to try to make matters easier for you. But that doesn’t mean you have no options left. The Home Affordable Refinance Program governs loan modification programs and allows for other services to step in and help you find a solution that fits within your current needs. Some of these programs like Ocwen Loan Servicing offer services. They require that you fill out a Request for Mortgage Assistance and a Financial Hardship Affidavit. They typically offer a number of services ranging from lump sum reinstatements to refinancing to full modifications. In some cases, they may buy out your loan in full or they may work out a solution where they negotiate and you send payments to them for them to divvy up.
When finances get tight, it can become exceptionally stressful for everyone involved. You may be tempted to let the matter slide and hope that everything will right itself, but that is one of the worst things you can do. Instead, you should begin exploring options to save your home immediately. The two most popular include forbearance or deferment plans as well as loan modification programs. Make sure that you start pursuing these options sooner rather than later. The farther behind you get on your house payments, the fewer options will be available to you.
If you have made some financial missteps or just need some additional counseling, consider talking with an attorney at Van Horn Law Group to guide you out of the mess.