mortgage foreclosure alternatives & resources
If you're worried about the possibility of your home falling into foreclosure, know that there are possible alternatives. Sometimes a lender may not pursue foreclosure even though your loan payments are behind. And although a lender isn't required to accept any offers or renegotiate the terms of your loan, there may be alternatives to foreclosure. Contact your lender to see what options may be available to you.
Special Forbearance
Your lender may be able to temporarily reduce or suspend your payments for a fixed period of time. At the end of that time, you must make a lump sum payment or enter into a long term repayment plan to pay back the reduced or suspended amount. Forbearance may be a good option when the cause of your default is specific and temporary and it is reasonable to assume you will be able to resume making payments at the end of the forbearance period.
Repayment Plan
Your lender may be able to arrange a simple repayment plan whereby you make your mortgage payment plus an amount of the total in default. The plan could be a few months long, or may extend to a year. At the end of the time period, you would have paid off the past due amount and your payments go back to the original payment amount. Your lender or servicer may require a good faith payment upfront to begin the plan. A repayment plan may be a good option when the situation that caused your default is resolved. For example, the default may have occurred because you were unemployed for a period of time, but you have now become employed again.
Mortgage Modification
You may be able to refinance the debt and extend the term of your mortgage loan. This will help you catch up by possibly reducing the monthly payments to a more affordable level. You may qualify if you've recovered from a financial problem but your net income is less than it was before the default.
Partial Claim
Your lender may be able to work with you to obtain an interest-free loan from HUD to bring your mortgage current, if you qualify.
Pre-Foreclosure Sale
This will allow you to sell your property and pay off your mortgage loan to avoid foreclosure and damage to your credit rating. If you're unable to afford the house long-term, you may sell the house yourself before the foreclosure sale and save some of your equity.
Deed-In-Lieu of Foreclosure
As a last resort, you may be able to voluntarily "give back" your property to the lender. This won't save your house, but may help your chances of getting another mortgage loan in the future.
Contact Doug Stephenson at 206-842-6929, or contact your local Viking branch to be referred to a lender that can assist you.
Information and documents to have available
» Your loan number and most recent mortgage payment statement.
» Details on the assets you own such as homes, real estate, retirement funds, investments,
checking, savings, and certificate accounts, and automobiles.
» Details on your monthly income and your most recent pay stubs as well as any benefit
statements from social security, disability, unemployment, retirement, or public assistance.
You may provide information on alimony, child support, or separate maintenance income,
though you need not if you do not wish the have the income considered as a source of
repayment for your loan.
» Details on your monthly expenses including monthly payments on loans or credit cards,
your auto and homeowners insurance, homeowners association dues, real estate taxes,
childcare expenses, and child support or alimony.
You can also contact the US Department of Housing and Urban Development to speak with a housing counseling agency that can assist you. Call 1-877-894-HOME (1-877-894-4663) to speak with a HUD approved counselor near you.