Help for People Who Lost Their Homes to Foreclosure


Losing a home to foreclosure is a distressing experience. For many people, the most important things at this time are finding new housing, becoming financially stable and eventually purchasing a new home. In some cases, your lender may prove to be a good resource at this time. Some lenders will allow you to rent your home until you can find a new place to live, and some may even provide you with cash assistance that can help you get into a rental property.

Ask About Renting Your Home from the Lender

  • Vacant homes present problems for lenders, as these homes are vulnerable to break-ins by thieves, vandals and squatters. If your lender can’t find someone to buy your home right away, the lender may allow you to rent the home until it is sold. Ask your lender about renting the property to you after the foreclosure is completed.

Renting From a New Landlord

  • Renting after a foreclosure can be a challenge. Foreclosure lowers your credit score, which can hurt your chances with many landlords. In addition, your financial issues may make it difficult to save money for a security deposit and moving costs. In fact, many landlords may require a larger-than-normal security deposit because of your foreclosure. Ask your lender about a “cash for keys” deal: You agree to forgo a court ordered eviction and instead voluntarily leave your home by a specific date. In return, your lender gives you cash that you can use to start over in a new home. If you choose this option, make sure you understand your lender’s requirements for the condition of your home. In most cases, you’ll be required to remove all of your personal possessions and leave the home in excellent condition.

Get Rental Assistance

  • If you are having difficulties finding a new place to live, make an appointment with a HUD-approved housing counselor. A HUD counselor can help connect you to programs that can help you find housing. The counselor may be able to steer you toward homelessness prevention programs, as well as social services that can assist you in getting the money for a security deposit or rent payment.

Getting a New Mortgage

  • Once you have a new place to live and have stabilized your finances, you may eventually consider buying a new home. While some mortgage programs require a significant amount of time to pass between your foreclosure and qualifying for a new mortgage, there are other programs with more lenient requirements. The U.S. Department of Veterans Affairs offers second chance mortgages to qualified individuals in as little as two years after a foreclosure. The FHA Back to Work program allows some former homeowners to qualify for a mortgage 12 months after a foreclosure. If you want to borrow through one of these programs, you'll have to show that you've addressed the financial issues that caused the foreclosure. You'll also have to show that you have the income needed to afford your mortgage payments.


  • Photo Credit Steven Heap/iStock/Getty Images
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