http://www.debts.org/index.php en info@debts.org Copyright 2008 2008-12-01T15:28:00+00:00 http://www.debts.org/11/index/how_to_avoid_foreclosure/ http://www.debts.org/11/index/how_to_avoid_foreclosure/#When:14:37:00Z 1. Face the problem.Okay so you have missed a mortgage payment, maybe a few, but the worst thing you can do is ignore letters from your lender. Instead of putting them at the back of the drawer, reply to warning letters promptly. The further you fall behind on payments the harder it will become to reinstate your loan.2. Contact your lender at first sign of trouble.The worst scenario for your lender is to inherit your home because of foreclosure. Your lender will have various means in which you can reinstate your mortgage and hold onto your property – if you seek their help early. More... 3. Respond to all mail from your lender.It may sound like we are repeating the first point but that’s for good reason. Many people who would otherwise have been able to keep their property have lost it because they were scared to open mail from lenders.The first notices you receive will offer good information about foreclosure prevention options that can help you weather most financial problems. Any mail thereafter may include notice of pending legal action. The foreclosure court will not accept unopened mail as an excuse! 4. Know your mortgage rights.Study your loan documents for details on what your lender may do if you can’t make your payments. Learn about the foreclosure laws and timeframes in your state (as every state is different) by contacting the State Government Housing Office. It is important to be prepared!5. Understand foreclosure prevention options.Valuable information about foreclosure prevention (also called loss mitigation) options can be found here.6. Contact a HUD-approved housing counselor.The US Department of Housing and Urban Development (HUD) funds free or very low cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender if you need this assistance. Find a HUD-approved housing counselor near you here or call (800) 569-4287 or TTY (800) 877-8339.7. Prioritize spending.After healthcare, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment. Download our free guide to Getting Out and Staying Out of Debt and use our calculator to help make a monthly budget. Look for optional expenses you can eliminate, ie, cable TV, gym memberships or dining out. As your mortgage is a main priority, delay payments on credit cards and other ‘unsecured’ debt until your mortgage is reinstated.8. Use your assets.As mentioned previously, your mortgage is a priority debt and must be paid using any resource at your disposal. Sale of assets such as a second car, a whole life insurance policy or valuable jewelry can be used to repay your loan. Perhaps you can consider a second job until your back on your feet financially. Maybe you could consider asking a teenage son or daughter to work part-time in order to help fund schooling or entertainment costs? Even if these efforts don’t significantly increase disposable cash, they will demonstrate to your lender a willingness to repay the debt.9. Avoid foreclosure prevention companies. It never makes sense to pay for something you can get for free, especially when you need every spare dime to go towards your mortgage repayments. Foreclosure prevention companies are not always legitimate but even those that are will charge you very large fee for help (two or three month’s mortgage payment). For free mortgage assistance, contact a HUD approved housing counselor.10. Don’t lose your house to foreclosure recovery scams!If any firm claims they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf, you may well be signing over the title to your property and becoming a renter in your own home!  Never sign a legal document without reading and understanding all the terms and getting professional advice from an attorney, a trusted real estate professional, or a HUD approved housing counselor. (Source: HUD)Make yourself at home in our Forum and find out what everyone else in America thinks about foreclosure. There is also our up-to-date News section for all the latest on personal finance. If you need help finding a provider or would like to review a company, please don’t go without checking out our A-Z directory. How to Avoid Foreclosure 2008-07-11T14:37:00+00:00