BORROWER OPTIONS FOR FORECLOSURE AVOIDANCE
Options that may be available to borrowers who are unable to afford their mortgage payments and who wish to avoid foreclosure, and instructions on how to explore those options:
At this point, if your loan has not matured, you may bring your loan current if you have the ability to do so.
The U.S. Department of Housing and Urban Development (HUD) funds free or very low cost housing counseling nationwide. To get the HUD pamphlet on foreclosure avoidance click: How to Avoid Foreclosure. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender if you need this assistance. Find a HUD-approved housing counselor near you or call (800) 569-4287 or TTY (800) 877-8339.
You may find other alternatives on the HUD website including articles on "Tips for Avoiding Foreclosure" by going to the following web site at http://www.hud.gov/foreclosure/.
Refinance : Depending on your financial situation, you may be able to refinance your loan with your lender or with another lender. At this time, there is no guaranty that you will qualify for a refinance, so you should consider all of your options even if you decide to try to refinance.
Pre-foreclosure sale of property :If you cannot refinance your property, you may be able to sell it before it is foreclosed. However, time is important so you may want to investigate this option and other options right away.
Depending on your financial situation, and subject to the lender's policies and agreement, you may be able to arrange for the following in order to avoid or delay the foreclosure of your property:
At this point, if your loan has not matured, you may bring your loan current if you have the ability to do so.
The U.S. Department of Housing and Urban Development (HUD) funds free or very low cost housing counseling nationwide. To get the HUD pamphlet on foreclosure avoidance click: How to Avoid Foreclosure. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender if you need this assistance. Find a HUD-approved housing counselor near you or call (800) 569-4287 or TTY (800) 877-8339.
You may find other alternatives on the HUD website including articles on "Tips for Avoiding Foreclosure" by going to the following web site at http://www.hud.gov/foreclosure/.
Refinance : Depending on your financial situation, you may be able to refinance your loan with your lender or with another lender. At this time, there is no guaranty that you will qualify for a refinance, so you should consider all of your options even if you decide to try to refinance.
Pre-foreclosure sale of property :If you cannot refinance your property, you may be able to sell it before it is foreclosed. However, time is important so you may want to investigate this option and other options right away.
Depending on your financial situation, and subject to the lender's policies and agreement, you may be able to arrange for the following in order to avoid or delay the foreclosure of your property:
- A forbearance agreement or workout agreement where the lender and the borrower agree, in writing,that the lender will defer foreclosing so long as the borrower does certain things including, but not limited to, making agreed upon post-default payments;
- A loan modification - where the lender and borrower agree, in writing, to modify the terms of your loan;
- If you have not been able to sell your property and have no lien junior to your lender's deed of trust,your lender may accept a deed-in-lieu of foreclosure in satisfaction of the amount of your loan.
- Where the current fair market value of your property is less than the amount you owe on your loan,the lender may agree to a short sale allowing your property to be sold for less than the amount of the loan balance.
- Hardship Letter – Explain your hardship situation and explain your resolution to bring your account current.
- Tax Returns – Last two (2) filed tax returns with all schedules.
- Paystubs – Last two (2) months (Dated within the last 30-60 days).
- Alternate Income – Unemployment, Social Security, Disability, Death Benefits, Pension or Public Assistance Last two (2) months (Dated within the last 30-60 days).
- Optional Income – Spousal and Child Support Payments (If requesting income to be included to qualify), Last two (2) months (Dated within the last 30-60 days).
- Bank Statements – Complete with all pages, the last two (2) months (Statement must identify daily balances).
- Monthly Household Expenses – Review, complete and return the attached expense worksheet for further review.
- Property Liens – Proof/Status of any other liens on the property
- Property Taxes and Insurance (If Applicable) 1) Declaration Page – Must indicate current status. 2) Copy of current Payment Plan in place.
