If you are behind on your mortgage payments you may be surprised to receive a foreclosure letter in the mail from someone (or a company) that you've never heard of, letting you know they are aware of your financial difficulties and offering a possible alternative to a credit damaging foreclosure. These letters may be handwritten in order to make you feel more comfortable and appear friendly or they may be quite formal on business letterhead.
The Offer is NOT for Your Protection
These letters are usually quite legitimate as long as you understand their purpose, which is to help the real estate investor (NOT YOU) find a great deal. A foreclosure letter is a form of direct mail, which in turn means that it is a sales tool used to uncover good prospects for the person or company who sent the letter.
Because the sender of the letter is primarily interested in purchasing real estate at an excellent price under typical market value, they are not likely to share with you all of the alternatives to foreclosure that may be available to you. Facing foreclosure is overwhelming, and the best way to navigate through the process is to realize that it is a process and that there are many different professionals from your mortgage lender, to credit counselors and real estate attorneys to specially trained real estate agents who can discuss a variety of different alternatives with you including loan modification, loan forbearance, short sales or deed in lieu of foreclosure.
While you may have realized that you can't financially afford to keep your house and find yourself tempted by the offer in the foreclosure letter, your best response is to a foreclosure letter is to get more information from the person who sent the letter, but keep in mind this is very, very likely not your only or best alternative to a foreclosure. Be prepared to ask questions about other similar deals they have done, ask for references, get everything in writing, make sure you understand the terms fully, and consult a real estate attorney in your area (preferably one who specializes in foreclosures). The federal government has a great website packed with important information at www.MakingHomeAffordable.gov. If you are interested in selling your home, or learning more about the short sale process (where you lender agrees to let you sell the house for less than you owe on it) visit www.cdpe.com/find/cdpe.
Respond to a foreclosure letter by being armed with information!
Talk to a Foreclosure Defense Attorney
If you are having trouble with mortgage payments, or the bank won't accept a modified loan, and especially if a foreclosure has already started, talk to a foreclosure attorney to find out what legal options you have to save your home and lower your mortgage payments.
