Stop Foreclosure - The Loss Mitigation Alternative
If you find yourself facing foreclosure, there are probably several contributing factors, which have led to your situation. You might have lost your job, suffered an illness (and its accompanying medical bills) or been through a divorce. However you get here, one thing is certain; the bills are piling up and it is getting harder and harder to make ends meet. Even worse is the situation of having an adjustable rate mortgage whose interest rate has skyrocketed, making your payments much larger.
However, while you're occupied by trying to stop foreclosure from happening, you're being constantly deluged with calls, letters and even house calls.
These investors are in the business of buying homes from people who are in danger of losing their homes to foreclosure and then selling these properties for a profit. They know that many people who are facing foreclosure have no alternative other than to sell their home for whatever price they can get.
Should you sell to an investor to avoid being foreclosed on? Maybe, but certainly not as your first option. And only after you exhausted other foreclosure prevention means such as rearranging your loan.
One of the Solutions To Stop Foreclosure Is Lender Mediation
If you have missed a few payments, your credit score will drop dramatically; once this data is on your credit report, it will be difficult if not impossible to get a new loan to refinance your existing mortgage.
However, mortgage lenders would really rather not end up owning your home; this is why every mortgage lender has a loss mitigation department which tries to work with homeowners who are in default on their mortgages to bring them back onto a timely payment schedule. Unlike refinancing your mortgage with a new loan, this loss mitigation process does not require getting a credit approval, putting this alternative within reach for homeowners who are in default.
A Repayment Plan May Still Be Challenging
Loss Mitigation departments are lightly staffed. One of the biggest problems with workout plans is caused by employee overload. At time of high default rates, like we're experiencing now, the employees have too many files to work on. And they have a limited time to process each case. The result is, the lender offers you a 'canned' repayment plan that has too short of a 'catch up' time and too large of monthly payment increase that is not realistic for your budget to sustain.
Because you're between a rock and a hard place you're tempted to take it to keep your home from being foreclosed on. In reality you just set yourself up for a failure. A few months down the stretch, you'll be back in foreclosure again.
Stop Foreclosure By Hiring Foreclosure Workout Companies
You may be much better off by hiring a professional to handle the loss mitigation process for you. These companies know the ins and outs of the loss mitigation process and often have strong relationships with mortgage lenders nationwide. They have successfully helped thousands of homeowners stop foreclosure.
Firms like these will take a thorough look at your finances and develop a repayment plan, which will meet your budget in order to allow you to successfully get back on track with your payments. These professionals have the inside track on the repayment programs, which may be available from different lenders, they may even be able to negotiate a lower interest rate to help you reduce your payments.
You may think in you current circumstances hiring a company like this could be prohibitively expensive. Not so. Most charge a reasonable flat fee equal to a single monthly mortgage payment. You'll easily get your money back through a negotiated for you deferral of the next loan payment.
How to Cut Your Losses if Loss Mitigation is Not in Your Plans
If stopping foreclosure through loss mitigation isn't in your plans, then it's time to sell your home so you don't have a foreclosure record on your credit. If you have a lot of time before the foreclosure sale, then list your home for sale with a real estate agent. This way you will get more for your property. If you're out of time, now you may have to turn to investment companies that can buy quickly. Just make sure you're dealing with a company that has means and track record to perform and close the purchase fast.
However, while you're occupied by trying to stop foreclosure from happening, you're being constantly deluged with calls, letters and even house calls.
These investors are in the business of buying homes from people who are in danger of losing their homes to foreclosure and then selling these properties for a profit. They know that many people who are facing foreclosure have no alternative other than to sell their home for whatever price they can get.
Should you sell to an investor to avoid being foreclosed on? Maybe, but certainly not as your first option. And only after you exhausted other foreclosure prevention means such as rearranging your loan.
One of the Solutions To Stop Foreclosure Is Lender Mediation
If you have missed a few payments, your credit score will drop dramatically; once this data is on your credit report, it will be difficult if not impossible to get a new loan to refinance your existing mortgage.
However, mortgage lenders would really rather not end up owning your home; this is why every mortgage lender has a loss mitigation department which tries to work with homeowners who are in default on their mortgages to bring them back onto a timely payment schedule. Unlike refinancing your mortgage with a new loan, this loss mitigation process does not require getting a credit approval, putting this alternative within reach for homeowners who are in default.
A Repayment Plan May Still Be Challenging
Loss Mitigation departments are lightly staffed. One of the biggest problems with workout plans is caused by employee overload. At time of high default rates, like we're experiencing now, the employees have too many files to work on. And they have a limited time to process each case. The result is, the lender offers you a 'canned' repayment plan that has too short of a 'catch up' time and too large of monthly payment increase that is not realistic for your budget to sustain.
Because you're between a rock and a hard place you're tempted to take it to keep your home from being foreclosed on. In reality you just set yourself up for a failure. A few months down the stretch, you'll be back in foreclosure again.
Stop Foreclosure By Hiring Foreclosure Workout Companies
You may be much better off by hiring a professional to handle the loss mitigation process for you. These companies know the ins and outs of the loss mitigation process and often have strong relationships with mortgage lenders nationwide. They have successfully helped thousands of homeowners stop foreclosure.
Firms like these will take a thorough look at your finances and develop a repayment plan, which will meet your budget in order to allow you to successfully get back on track with your payments. These professionals have the inside track on the repayment programs, which may be available from different lenders, they may even be able to negotiate a lower interest rate to help you reduce your payments.
You may think in you current circumstances hiring a company like this could be prohibitively expensive. Not so. Most charge a reasonable flat fee equal to a single monthly mortgage payment. You'll easily get your money back through a negotiated for you deferral of the next loan payment.
How to Cut Your Losses if Loss Mitigation is Not in Your Plans
If stopping foreclosure through loss mitigation isn't in your plans, then it's time to sell your home so you don't have a foreclosure record on your credit. If you have a lot of time before the foreclosure sale, then list your home for sale with a real estate agent. This way you will get more for your property. If you're out of time, now you may have to turn to investment companies that can buy quickly. Just make sure you're dealing with a company that has means and track record to perform and close the purchase fast.
About the Author:
Yes, loss mitigation is an effective solution to stopping foreclosure ofyour home. Start by getting a referral to a reputable lender mediation company to avoid foreclosure.
posted by Debt Consolidation Loan at
2:22 PM
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