Stop Foreclosures; Steps to Take at the First Sign of Trouble

By: philip smith

Stop foreclosures before the lenders draft the Default notices. Rather than hope the problem will go away, with a little luck, borrowers on the brink of being unable to meet their mortgage payments should act immediately to address their financial pressure. Here are some simple ways to take control and ensure the softest landing, steps that should be taken before you miss a payment on your home loan.Put a detailed budget together, starting with existing net income and outgoings, then make deep inroads into everything but the most basic costs of food and utilities. Act on it, even before you have completed it. Retire your credit cards, but continue to pay off debt as quickly as you can. Don't fool yourself, if you don't know where every cent of your income goes, you won't convince a lender to agree to your refinancing request.

Still nowhere near enough to meet those readjusted payments? Consider all other resources; life insurance, 401K.Talk to your family; is there a way you can free up a room to let? Trade down to a car that is cheaper to run, or maybe public transport in your neighborhood will get you to and from your job.Never have been very good at this? Get counselling help from a local non-profit credit counselling agency, or a HUD-approved housing counselling agency.The picture still looks bleak and there is nothing left to cut? Call your lender and arrange a meeting, don't wait until a payment has been missed. The earlier you show him how you have tried to address the problem the greater the chance of a loan modification. The lender may mail you a loan workout package to be completed before the meeting, be sure to complete all forms and return them without delay. If you and your lender agree you can no longer afford your home, you will be given a specified time to find a purchaser and then pay the total loan owed. You will be expected to retain a professional real estate agent to market your property aggressively, to find a buyer within the time given. A qualified buyer may be able to assume your loan. Remember, throughout this you have retained control over your fate, and will have the sound basic knowledge and good credit record intact to return to home ownership in the future.

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