Help With Foreclosure

When you purchase a home, you will most likely take out a loan from a mortgage lender. By agreeing to this home loan, the lender gains interest within the property and if you are unable to continuously make payments on the aforementioned loan, the lender has the ability to auction off your home to recoup its financial investment, which is known as foreclosure, according to the Consumer Credit Counseling Service of Orange County, California.

HUD Foreclosure Avoidance Counseling

The U.S. Department of Housing and Urban Development, or HUD, has developed a specific program to help those who are facing foreclosure. In recent years, thousands of foreclosure counseling services have opened to provide help, however, some of these operations exist to take advantage of desperate homeowners. To prevent being scammed by a false foreclosure counseling service, the official HUD website features a list of all accredited counseling agencies in the United States.

Homeowner Affordability and Stability Plan (HASP)

During the first part of 2009, President Barak Obama revealed the Homeowner Affordability and Stability Plan, which consists of $75 billion dollars to cover the loans of homeowners who cannot make their payments due to lack of income. This federal program allows eligible homeowners to take out a new 30-year fixed-rate loan with repayment rates based on yearly income. Homeowners must provide income verification, which includes tax returns and pay stubs, and have a history of making mortgage payments on time. Also, the mortgage loan in question must be from, or securitized, by Freddie Mac or Fannie Mae, states Macon Philips of The White House Blog.

Non-Profit Organizations

If you are close to foreclosure, or fear you are on the road to this financial hardship, non-profit organizations are able to discuss your repayment options and, in some cases, introduce you to companies that allow you to refinance your mortgage loan. A credible non-profit organization will have an established list of clients and be in good standing with the Better Business Bureau. Non-profit services should never carry a fee as they operate to provide relief for struggling homeowners not to collect a profit. NeighborWorks Center for Foreclosure Solutions conducts national outreach programs for those facing foreclosure.

Avoiding Foreclosure Tips

When facing the possibility of foreclosure, attend a foreclosure prevention workshop in your city, or nearby city. These workshops disclose vital information and tools to help derail your path to foreclosure. If you've missed several payments, a proactive step to prevent foreclosure is to speak with your mortgage lender. Prior to contacting the lender, gather your monthly income statements, current bills and other financial information. Inform the lender you desire a loan workout agreement, which is when you negotiate a lower monthly payment to prevent foreclosure. If you find yourself short of income, notify the mortgage lender. By doing so, many lenders will extend your due date to prevent a negative mark on your account.

Warning

Do not wait until your home is on the foreclosure auction block to seek out loan assistance. The earlier you actively ask for help for your mortgage the better your chances are to prevent your loan from reaching foreclosure status.