As a real estate investor or a homeowner, just like everyone else, there are times when things are not going as planned. Sometimes, unexpected calamities such as divorce, and natural disaster can have a big blow on your finances and make it hard with making your loan payments on time. As a result, you could face your home going into foreclosure.
What then are your options? From refinancing to making a trust deed forbearance plan or selling to a Professional Home Buyer, there are several ways to prevent foreclosure on your home. Here are the best options when you are behind on your mortgage.
Here are the best four options to help you catch up when you’re behind on your mortgage payments:
#1 Reaching out to Your Loan Lender
• Repayment Plan
The mortgage repayment plan is a very effective option to stop foreclosure on your home; provided you have extra income to fund your regular monthly mortgage payment. It involves paying a lump sum which covers the amounts past due, including fees and costs before the agreed deadline catches up.
• Trust Deed Forbearance
When you miss out on your monthly mortgage payments due to life events such as illness, divorce, natural disaster, you may qualify for a trust deed forbearance. It’s a formal agreement between you and your lender that allows you to repay arrears over a period while simultaneously making regular monthly mortgage payments. Unlike the repayment plan, trust deed forbearance offers flexible payments, including a long-term period of suspended payment to allow you to recover from whatever loss you may have had.
#2 Change the Terms of Your Mortgage
Provided your loan lender isn’t willing to change the terms of your existing mortgage plan, refinancing or a loan modification might be your best bet.
Refinancing is when a new mortgage note is executed to replace your original loan which pays off the prior loan in full. And to this effect, new terms for repayment is made. You might get lucky to secure a lower lump sum at a lower interest rate, which would reduce your monthly payment.
Refinancing allows you to convert equity in your home into cash without having to make monthly payments on your mortgage. While this is a good option, we recommend you try to refinance as early as possible before your home goes into foreclosure.
• Loan Modification
Like the refinancing option, a loan modification involves a written agreement between you and your lender to change one or more terms of your mortgage due to your inability to afford the original loan terms. Usually, it may also be done by reducing the interest rate, capitalizing delinquent payments, or extending the terms on your mortgage. However, when contacting your lender, it’s important to state realistic reasons you could no longer meet the current mortgage payment plan. For example, a permanent change in circumstances may be considered as authentic.
Filing for a bankruptcy petition is another alternative to stop foreclosure immediately. However, you’ll be required to make regular payments, as if you were solving the problem that caused you to fall behind the mortgage. Should you want to try out this method, we recommend you consult an attorney with experience in bankruptcy to determine if you’ll be able to complete a bankruptcy plan – since your home and credit are on the line.
#4 Sell Your Home
Either by listing or by selling directly to Houston home buyers, do it fast! This is by far the best among other options since you don’t have to worry about mortgage payments or HOA fees & taxes. They also have programs that can take over your mortgage payments. Read more here on how to sell your house to avoid foreclosure in Houston, TX.
Need some help?
If you need an independently owned professional group with proven expertise in dealing with properties in pre-foreclosure, the Redemption Group would be more than happy to help you. Talk to an expert today via (323)379-4086