3 Ways to Save Your Home from Foreclosure

Published by julia | Filed under Buyer / Seller Tips, Listings, Miscellaneous, Real Estate, Shout Outs, Uncategorized

Let’s face it–the economy is in a terrible downturn. Many people are struggling financially like never before, and paying the monthly mortgage bills may be getting more and more difficult. If you’ve lost your job, are facing the increase of an adjustable rate mortgage, or have other high expenses you didn’t have before, you may be facing the potential loss of your home. However, there is good news. Banks today know that there are a record number of struggling homeowners and are more willing than ever to help find ways for people to either keep their homes or avoid getting a foreclosure on their credit reports. Here are 3 ways you can potentially save your home from foreclosure.

1.  Try to work out a payment plan with the bank. Many banks are now willing to do this. There are a number of ways a repayment plan can be accomplished. You may be able to add additional amounts to your monthly mortgage payments until you’ve caught up on the back amount you owe. You may also be able to defer some payments, or even put the missed payments on the end of the mortgage, so that you won’t have to worry about making them up now.

2.  Rent out your home. With so many people losing their homes, the rental market is getting huge. If you can’t afford to stay in your home, you may be able to rent it out for enough to cover the monthly mortgage payment, or at least for enough that it won’t be a hardship for you to make up the difference. You can then move into smaller, less expensive accommodations until you’re financially able to handle the payments on your house again. This way, you get to keep the house for future use. Alternately, you could take in boarders or roommates to help with the mortgage.

3.  Re-finance. Re-financing is often the gold standard of keeping a house safe from foreclosure. While not everyone may be able to do this (as credit and past payment history with the bank will be large determining factors here), if you can re-finance your mortgage at a lower interest rate, you may stand a good chance of being able to keep your home. The lower the interest rate on your mortgage, the lower your monthly payments will be. So, if you’ve got an adjustable rate mortgage that’s gone too high for you, this may be a good option to get those payments back under control and keep your house.