How to Avoid Losing Your House to Foreclosure

Foreclosure is the legal process that a bank or mortgage company uses to recover of piece of real estate property.
In short, it is the legal process of
repossessing a property.

Difficulty: Moderately Easy

Instructions

1. 
    

   Don't Ignore The Problem
   
   This will only make things worse.
   A Foreclosure on your credit history can have
   a very negative effect on your rating.

2. 
    

   Notice of Foreclosure
   
   If you have received one, it's not too late.
   Understand that the LENDER would prefer you to continue to pay on
   your mortgage than default because they make their money on the
   INTEREST AND FEES associated with the mortgage process.
   Many lenders are willing to work with a borrower to find a solution that will allow the homeowner to keep their house.

3. Be Prepared with Financial Information
   
   If your monthly income suddenly drops, due to job loss or illness, the lender may be willing to make a temporary adjustment to your monthly mortgage until your monthly income increases again.

4. Get Counseling
   
   If you feel you may be in trouble, contact
   a mortgage counseling service such as Homeownership Preservation
   Foundation Homeowner's HOPE HOTLINE (888-995-HOPE) open 24hrs a day.

5. SEEK AN ATTORNY
   
   If you're behind in your mortgage payments and you
   believe foreclosure may be imminent, seek an atorny who
   will represent your interests in dealing with the mortgage company.

6. Pay Your Property Taxes
   
   You may choose not to escrow for property taxes
   and property insurance, however, incorporating them into your
   monthly mortage payment will protect you. Many homeowners don't realize that in many states, the city, county, and state government
   TAKE PRIORITY over lenders in repossessing a property if the property taxes are not paid.

7. Be Prepared to Move
   
   The foreclosure process varies from state to state.
   Some allow a lender to begin the foreclosure process if a
   homeowner is only one month behind and if there is no way for you
   to avoid foreclosure, you will need to seek a new residence.

8. Know Your Legal Rights
   
   Learn more about your legal rights
   in the event of a foreclosure, visit FindLaw.com.

Resources

• Find an Attorny

[bensellars]

on 7/26/2009 Very timely indeed. Thanks!

[dengineer]

on 7/13/2009 Great post! very good advice especially in these economic times.

[bailey4]

on 6/26/2009 Very specific advice on how to avoid losing your house to foreclosure. 5*

[cherylphillips]

on 6/19/2009 Excellent and timely article 5*

[xrayness]

on 6/17/2009 My brother suffered a foreclosure. Bad situation.