Before You Get To Foreclosure

 Foreclosure is one of the most devastating events that can happen in a person’s life. It is difficult to watch your dream turn into a nightmare right before your eyes. Often associated with the loss of one’s home are other losses such as the loss of a spouse (through death or divorce), a job or health. This lends credence to the saying, “when it rains, it pours.”

However, I am always amazed at the number of people that simply do NOTHING as their home goes into foreclosure. They won’t call the bank and won’t answer the phone when the bank calls them. They don’t open the mail and won’t attempt to make contact of any kind with the lender. It is almost as if they believe that if they don’t say anything, it might all go away. But it doesn’t.

Prior to foreclosure there are four main workout options that can be explored – Forebearance, Loan Modification, Partial Claim or a Short Sale.  Each option depends on timing – how delinquent your mortgage is and if your situation is temporary or long term. The homeowner can initiate any of these options or can work with an approved housing counselor to start the ball rolling.

It is easy to despair in this situation but the key is action. Take control and face the problem head on. The sooner the homeowner makes the call, the better because banks are finding solutions. Banks and lenders have a financial incentive to workout plans for the borrower when possible. The next several posts will deal with each workout option and the foreclosure “scams” to watch out for. Post questions for me and I will make sure that I answer them in the blog. If the question is personal, e-mail me directly – ritacox@kw.com  Everyone knows someone affected by foreclosure and education is key.

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