Foreclosure can occur when you fail to make your mortgage payments.
Foreclosure is used in describing the legal means that a lender uses to repossess your home.
When your home has been repossessed, you have to move out. If the property ends up being worth less than the amount you owe on your mortgage, the lender could decide to pursue a deficiency judgement.
If this happens, then you end up losing your home and also owe the lender the additional amount.
Both deficiency judgement and foreclosures can have a big impact on your credit, and this makes it harder for you to get credit in the future.
Below are some tips that will go a long way in helping you stop foreclosures.
The best way to stop foreclosure Boston is by preventing the filing of the Notice of Default.
Lenders don’t like it when they have to foreclose on a home, but they do it because they are protecting their interest.
If you find yourself in a position where you have a hard time meeting your mortgage payments, then the first step is calling the lender.
There are some people who tend to ignore the letter from the lender, but they don’t realize they are making the situation worse.
A loan modification will be the best option for you, depending on your situations. Some of the loan modifications options you can get are;
- Lenders agreeing to give you some time before they can commence legal action against you and let you work out a repayment plan that you are able to afford. This is known as forbearance.
- Forgiving a payment is another option, though it rarely happens.
- This is where the lender will agree to let your payment be current after missing a couple of payments. The lender will give you a break and waive your obligation.
- Spreading out the missed payment over a long term is another option. If you pay $1,200 per month, the lender can add $200 in payments each month, and after a year of making the payments, you will have caught up. This is known as a repayment plan
- Changing the loan terms is another option. If you have an adjustable loan, the lender can decide to freeze the rate before it changes or increases so you can be able to manage the rate. The lender can also decide to extend the amortization period. This is referred to as note modification.
Adding back payments to the loan balance. This can happen when you have sufficient equity meeting the lending guidelines of the lender.
This is known as refinancing. The lender can decide to make a separate loan to you.
There are some government loans that have a provision that will let you apply for another loan to use in paying the missed payments, provided you meet the specific criteria. This is known as a partial claim.
If you want to stop foreclosure Boston, you have to work with the lender to come up with a solution.