Foreclosure can induce panic in any property owner, no matter the timing. Have you received a notice of default already? You might want to know how you can stop and/or resolve your foreclosure.
Cozmyk Law Offices, LLC’s foreclosure attorney in Cleveland, Ohio, outlines some viable options below for handling your foreclosure.
How To Stop a Foreclosure
To stop a foreclosure you must find a way to cure your default. This can be done using a number of different methods, depending on whether you’re facing a judicial foreclosure or a non-judicial foreclosure.
Some actions you can take to resolve and/or possibly stop the foreclosure process include:
Forbearance Agreements
You and your mortgage lender might come to agreeable terms, such as lower mortgage payments or even no payments, for a specified time frame. If so, you must demonstrate that you can and will resume scheduled payments in the original amount.
A loan modification is a longer-term option that permanently changes your mortgage terms.
Loan Reinstatement
Have you crunched the numbers? Can you make up for your missed payments? If you can pull it off, another way to avoid foreclosure is by making a lump-sum payment to your lender.
Typically, this sum would cover all the missed payments so that your mortgage provider quickly reinstates your loan. If you wait too long, though, there could be additional costs such as attorneys’ fees and escrow payments and other such items that get added on. If your account is eligible for a reinstatement this would resolve the foreclosure and allow you to resume making your mortgage payments.
Repayments Plans
A repayment plan is where you continue to make your regular mortgage payment, plus a little extra to catch up on the past due ones each month. It is usually a short-term arrangement that allows you to essentially reinstate your loan over time instead of in one lump sum payment. Sometimes these payments can be high, but they can preserve your equity and get you back on track.
Refinancing
Some homeowners also qualify for a refinancing agreement, which effectively signs a new mortgage agreement (usually with a different lender) with lower payment rates. If the foreclosure has not yet been filed, you may still be able to refinance which might include:
- Finding out whether you qualify for a new plan
- Setting a new, affordable payment goal
- Hiring a professional to appraise your home’s current worth
- Choosing a lender who suits your refinancing interests
- Putting money back to pay the new closing costs
- Closing the old mortgage
Ideally, qualified applicants arrive with good credit scores and sufficient property equity. You will need to have diligently repaid your current mortgage for a few years for any lender to consider refinancing.
Bankruptcy Filing
Finally, you can also file for Chapter 7 or Chapter 11 bankruptcy.
Bankruptcy cases go through local court systems. It’s likely to negatively impact your credit score, so treat bankruptcy as a last-ditch effort to salvage your home. If bankruptcy is in effect, you won’t have to pay or worry about foreclosure.
However, if it’s last-minute, and you have no time to explore other options this may be your best shot. A bankruptcy can only stop your home from being lost in a foreclosure auction if it is filed BEFORE the sale date.
Foreclosure Advice From Cozmyk Law Offices, LLC
Are you unsure of how to stop foreclosure, given your current situation? Contact Cozmyk Law Offices, LLC, for legal help on solid foreclosure defense and ideas to shield yourself against the burdensome credit impact of foreclosure. Call us at 877-570-4440 or fill out our online form for a FREE consultation.