In today’s economy, home foreclosures are more common than ever. If you’re faced with the possibility of losing your home due to foreclosure, you might find yourself in a tight situation without an idea of where to turn for help and desperate to answer the question of "how do I stop my foreclosure". It’s important to know that there are a few strategies available to you in order to stop a foreclosure… even if it’s down to the last minute.
How to Stop a Foreclosure
File Bankruptcy
It’s not everyone’s first choice, but filing bankruptcy can stop a foreclosure from going forward – at least temporarily, and that may be all you need. A Chapter 13 bankruptcy is less extreme than a Chapter 7, and will have the same effect of stopping your foreclosure, hopefully long enough for you to get your feet back on the ground.
You should be aware, however, that in the weeks following the bankruptcy filing, the bank that holds your home loan will most likely continue the process by attempting to gain permission to foreclose in spite of your bankruptcy. Because of this, bankruptcy is more a way to buy time than it is a permanent solution to foreclosure. But buying time might be exactly what you need to do, and during that time you should hopefully be able to negotiate a more permanent solution, most likely involving…
Loan Modification or Refinancing
This is a process in which your past-due amount on your mortgage is re-negotiated with the holding bank, thus removing the delinquency that is leading to your foreclosure. In most cases, you’ll need help to navigate such an arrangement; there are various companies that specialize in this type of negotiating, or you may consider the assistance of a financial lawyer. One aspect of loan modification could be a bail-out loan, which typically has a high interest rate and may be difficult to procure, but might be offered as a way to clear your past-due amount during the modification process. You may also be asked to consider a second mortgage on your home, or a total refinancing package on your current loan. Chances are you’ll lose money; most homeowners end up paying much higher interest for a bail-out loan or a refinancing package than they would have otherwise, but when your home is on the line, you may consider it worth the long-term cost.
The only real way to stop a foreclosure is to pay, or arrange to pay, what you owe the lender in overdue payments. Typically the best emergency strategy is to first do something that delays the process, such as bankruptcy, and then follow up with a refinancing or loan bailout that puts your account back in the green. If you’re faced with a foreclosure in your future, your best strategy is to act as quickly as possible, because time will become money when you’re pressed for options, and the more time you have, the less money you’re likely to lose in the process of saving your home.
Talk to a Foreclosure Attorney
A qualified and experienced foreclosure attorney can help you to explore all of your options and find the best solution for you. There are ways to stop foreclosure and an attorney is the best person to help you to explore all avenues and save your home.
