How to Delay Home Foreclosers in Michigan

Struggling Michigan homeowners can delay foreclosure while attempting to save their home. According to Realty Trac, the typical Michigan foreclosure takes eight months. There are a variety of steps you can take to extend the time you have in your home. Even if you are unable to prevent the foreclosure, there are alternative routes you can take. If you exhaust all options and still cannot avoid foreclosure, the process can be delayed long enough for you to make other housing arrangements.

Instructions

1. Contact your lender. While the ideal time to refinance your home is when you are current on the mortgage loan, refinancing is still an option for delinquent Michigan homeowners. The Making Home Affordable program allows homeowners to refinance or modify their loan to lower the monthly payment. According to the National Council of State Housing Agencies, Michigan is considered one of the states impacted the most by the foreclosure crisis. The U.S. Department of Treasury awards the state additional funds to help homeowners modify their loans.

2. Request a forbearance. If you experience a hardship, many Michigan lenders will grant you a temporary payment suspension. You will need to submit documents to support your hardship. Loss of employment, reduction in income or a medical condition can be grounds for a forbearance. If the lender approves the forbearance, you will be able to hold-off making payments for a set amount of time. When the forbearance period ends, you will resume making the mortgage payment. In most cases, the mortgage payment is increased slightly to compensate for the lost payments. Before agreeing to a forbearance, discuss how much your payment will increase.

3. Talk to a HUD-approved foreclosure prevention counselor in Michigan. The Michigan State Housing Authority provides homeowners with assistance locating a local counselor. The counselor will review your loan to determine the best course of action. Counselors are aware of the various programs offered and can help you to determine which ones best apply to you. In addition, a foreclosure-prevention counselor can advocate with the lender on your behalf.

4. Seek legal aid. The Michigan Foreclosure Prevention program provides free legal service to eligible homeowners. An attorney can assist you with challenging the foreclosure. Even though you may not win against the lender, you can still delay the foreclosure process. The attorney will review your mortgage documents to check for discrepancies or lender fraud.

5. File bankruptcy. As a last resort, bankruptcy can delay or even stop the foreclosure. Bankruptcy can not only help you avoid foreclosure, but will allow you to take care of any additional debt you may have accumulated. Once you file, an automatic stay is issued requiring lenders to cease collection activity. Your home will not be foreclosed until the bankruptcy is finalized or the automatic stay is lifted.

References

• Michigan State Housing Development Authority: Helping the Hardest Hit Homeowners
• Realty Trac: Michigan Foreclosure Laws
• Michigan Foreclosure Prevention Project: Home
• United States Courts: Bankruptcy Basics
• National State Council of State Housing Agencies: Hardest Hit Foreclosure Initiative
• Loan: Mortgage Forbearance Explained

Resources

• HUD: Avoid Foreclosure Michigan
• Making Home Affordable: Eligibility