3 min read
Foreclosure: a word that carries a significant amount of dread. The thought of losing your home can be incredibly stressful, making it nearly impossible to enjoy the rest of your life. For this reason, if you are in a position where you are feeling threatened with foreclosure, it is essential to remember that you are not alone. According to the U.S. Census Bureau, an estimated 17 million adults are behind on their rent or mortgage statements. So the question is: What can you do to stop it?
If Possible, Make A Payment
It may seem like common sense, but it is essential. Lenders focus primarily on the payment schedule when determining whether to foreclose on someone, specifically missed payments. That being the case, you don’t have to pay everything you owe the bank. Instead, look at your financial situation and see if you can afford a single monthly mortgage payment.
By doing this, you are demonstrating your intent and ability to continue paying for your home. If you can make just one mortgage payment, do it, and it would help if you started working on a plan to make the next payment.
Talk To Your Lender
One simple step to take is to contact your lender. It goes along with the earlier point of expressing your willingness to pay. Avoiding calls from your lender while continuing to get further behind is detrimental to your efforts to avoid foreclosure. Ideally, you will call your lender as soon as you know you will miss a payment. However, if you are already behind, you must contact your lender as quickly as possible.
Keep in mind that when your house is going to foreclose, your lender isn’t getting a good deal either. This process will cost them thousands of dollars between the paperwork, repossession, and selling your home. That said, lenders are very motivated to help you make your mortgage agreement work. It can include modifying your loan conditions or adjusting your payment schedule so that you can pay it over a longer term. Lenders can also grant forbearance, a temporary postponement of mortgage payments.
Get Credit Counseling
If you are overwhelmed with money management and debts, consider getting credit counseling. Credit counselors can help you understand more about loans and how they work. They also can teach you more about debt management and assist you with setting up a personal financial plan. In addition, some credit counseling agencies will go so far as to negotiate with your lender for you and assist with alleviating some of your debt.
Learn To Manage Your Debt
As with all good things, managing and reducing debt comes with sacrifice. Many resources are available to educate homeowners on budgets and ways to deal with increasing debt. The bottom line is simple: If you want to start making your way out of debt, you need to spend less on the things you want and more on things you need. With foreclosure looming, it may be time to put your pride in check. Instead, focus all your energy and resources on climbing out of your financial hole.
Foreclosure is a widespread and devastating life event to face. However, you can prevent foreclosure if you focus on communicating with your lender, managing your debts, and working hard to make the next payment. Remember to focus on the task and make it your top priority to succeed, no matter what.