Pennsylvania residents may not have heard about the recent tips concerning how to prevent a home foreclosure. Whenever a homeowner faces unexpected financial difficulties, extreme consequences can enter into the equation. If a home was used to secure debt, the lender may pursue foreclosing on the home in order to get the title to the property to pay off the debts the homeowner owes. There are several things a homeowner facing this unpleasant situation can do to prevent a foreclosure; some arrangements could require money upfront while others could involve going through the legal system.
When deciding what options are available to assist in preventing a foreclosure, consider what assets are accessible. Some of these assets may be in the form of disability insurance, savings or unemployment insurance benefits. Cutting down on your household budget can also help, and tapping into a retirement fund could help to pay a mortgage. If a payment is late or will be late, it is best to contact the lender and attempt to work out a modified payment schedule to avoid any problems in the future.
Often a company or lender will have several options available to assist in a loan modification. These options might include repayment plans, reinstatements, forbearance, claim advances and re-amortization. If there are no available opportunities to modify the loan, the best decision may be to consider selling the home. While it is a hard decision to make, it may bring in more cash than a foreclosure.
With so many decisions to weigh, it may be best to work with a bankruptcy attorney to assist with debt relief. It is possible that there are other ways to avoid a foreclosure and still take care of debt. A lawyer may be able to help a client understand the different ways options for debt relief.
Source: Realty Trac, "Stopping a Home Foreclosure ", December 12, 2014