How to Stop a Home Foreclosure in Utah
Foreclosure happens for one main reason although there may be a variety of circumstances leading up to it. When you are unable to pay your mortgage, your lender will seek legal action to repossess the home. Not only will you lose your home, but the foreclosure will have a negative effect on your credit score. Foreclosure also makes it difficult for you to own or rent another property. If you are on the verge of foreclosure in Utah, take the necessary steps to save your home.
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Instructions
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Remain in your home. Many homeowners are under the misconception that moving out of the property is the right step. According to the Federal Trade Commission (FTC), abandoning the home will disqualify you for some assistance. The federal Making Home Affordable program requires the home to be the applicant's primary residence. The foreclosure process takes about five months to complete.
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Review all options by contacting a HUD-approved housing counselor. Certified foreclosure prevention specialists evaluate your mortgage details and finances to determine the best solutions for your specific situation. The counselors can create a budget to prioritize your spending, negotiate with your lender and help you apply for assistance programs, such as the federal Making Home Affordable program. Possible options include refinancing at a lower interest rate, modifying the loan or requesting a temporary payment suspension. Neighborhood Nonprofit Housing Corporation and Community Action Services are both approved agencies that offer free counseling and workshops in Utah. Find local agencies through the Utah HUD website.
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Find out if your lender participates in the Home Affordable Foreclosure Alternative program. When keeping your home is no longer an option, you can still avoid the consequences associated with foreclosure. A short sale or deed in lieu of foreclosure allows you to voluntarily give up ownership of the property. In exchange, the program provides homeowners with up to $3,000 in relocation funds. The Making Home Affordable website lists various Utah lenders' contact and program participation information.
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File bankruptcy to stop the foreclosure. You can file either Chapter 7 or Chapter 13 bankruptcy to bring the foreclosure process to a halt. If you want to keep your home, filing Chapter 13 bankruptcy in Utah allows you to do so, provided you continue making your mortgage payment. Chapter 7 grants homeowners a fresh start. Meet with an attorney to evaluate your case before filing. Bankruptcy dramatically lowers your credit score for at least seven years. The Utah State Courts website provides useful resources for homeowners who cannot afford an attorney. Resources include law libraries, law clinics and links to free legal aid agencies.
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