3 Last-Ditch Efforts to Stop Home Foreclosure

Trying to stop home foreclosure is something that millions of people face every year. The thought of losing your home is not something that anyone likes to deal with; however, circumstances may force you to deal with it. The foreclosure process can be a little confusing for some people and many do not realize that there are several things you can do to try and keep your home. Here are a few things to try if you are faced with the task of stopping foreclosure on your home. 

1. Negotiate

Contrary to what you might believe, you are still in a position of power here. You still have the ability to make things right with the bank because they want you to stay in your house. If you end up leaving your house, the bank will lose money. They are not in the real estate business. When they have to dabble in it by foreclosing on a house, they lose money. They are in the banking business and count on your payment every month to help them run their business. If your payment stops, this is a negative thing for them. When you can avoid foreclosure, it helps them and it helps you save your credit. 

When you get a notice that says your home is in default, it is not too late to negotiate with the bank. Call them as soon as you get the notice and see what they are willing to do. They might lower your interest rate, change the structure of your payment plan, or use a number of tactics to keep you right where you are. This is better for both parties and it can really work if you try it. 

2. Private Lenders

Contacting a private lender could help you save your home from foreclosure. When you are in default with your current mortgage, most traditional lenders would not touch you. However, there are private lenders out there that like to take on high risk loans. These private lenders are individuals that want a higher than average return on their investment. They are willing to loan people money in default or in other desperate situations. 

Most of the time, they will loan you the money and you only pay interest on the loan. The loan is set up as a balloon loan and you will have to refinance the loan again at some point. It is usually a short term loan that lasts for one to two years. While it is far from ideal, it accomplishes the goal of keeping your house.

3. Sell the House

Trying to sell the house quickly might not be the best alternative, but it will keep a foreclosure off of your record. You can try to have the bank do a short sale, or simply list the house with an agent at a reduced price. If you can sell the house quickly, it will keep your credit from being ruined.

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