If you are facing foreclosure, you need to understand that there are many things you may attempt prior to losing your house. Investigating these solutions is worth it. Any time you miss a payment; you are on the track to foreclosure. The choice not to make a payment is the first step to losing your home.
One option to stay out of foreclosure is to refinance your current loan. If you have excellent credit as well as if your loan was obtained when rates of interest had been higher you could probably refinance your loan at a far better rate.
If you get a significantly lower interest rate the refinanced loan will have lower monthly payments. These lower payments could allow you to work down your other debts.
If refinancing is not an solution, your mortgage lender may possibly have the ability to assist you in a loan modification. With this tactic, your lender and you will enter a brand new contract with different terms from your old contract.
The balance of the loan will remain the same however the rate of interest or type of loan could be modified in your favor. As an example, moving from a 15 year variable rate of interest mortgage to a 15 year fixed rate with lower interest can lower your payments and save you cash with the lower payment.
If neither of these solutions is available for you, you may have another option available. The Federal Housing Administration (FHA) gives absolutely free economic counseling. Basically get in touch with the FHA and see if you will find counselors within your region. If there aren’t you will be able to get counseling over the telephone. The counselor will go over your loan paperwork and advise you on programs within your state, city or region that may make it easier to stay out of foreclosure.