How To Avoid Home Foreclosure!

By Jerry J. Jansen On September 9, 2009 Under Home Foreclosure

In these tough economic times, more Americans than ever are finding it difficult to pay the home loan notes they signed several years ago, or even more recently. The housing seller’s market a few years back gave buyers an ever-increasing confidence in buying real estate as an investment. They watched the price of houses skyrocket and felt that their home’s value would never fall and would only increase. Now, many of those same people are looking for advice about how to avoid home foreclosure.

In addition to the rather exorbitant prices many homeowners paid for their houses during the real estate boom that the nation underwent about five years ago or so, the “market value” of their homes was pretty exorbitant also. Many of those homeowners decided to cash in on the value of their homes by taking out second mortgages or lines of equity based on the high values associated with real estate at the time. Now, many of those same people are looking for advice about how to avoid home foreclosure.

So, how do you avoid home foreclosure?

Make your mortgage payments every month, even if it means doing without other things. If necessary, eat rice and beans.
If you begin to fall behind in your loan payments, do not avoid the lender’s calls or letters. That kind of behavior just makes the bank more likely to begin foreclosure because they think you will absolutely never be able to repay your loan and don’t even want to try.
Put your house up for sale. Getting out from under may be the best way to avoid foreclosure if you are able to sell. Some houses are still selling, even though the selling market is quite slow.
Seek the advice of a professional. There are companies and other groups to help you evaluate your situation and perhaps represent you. Some are for profit and some are nonprofit.
Understand the language of your original home loan and any subsequent loans you took out on your home. Some mortgages have helpful information about how to avoid home foreclosure attached to, or included in, the mortgage.
Contact a housing counselor at Housing and Urban Development (HUD).
Make your mortgage payment before any other payments. If you have unsecured debt such as credit cards, pay those only after you have paid your mortgage.
Increase your income. You can get a second job or maybe someone else in the family can. If you are always buying your teenage son’s clothes, perhaps it is time for him to get flip burgers or stock shelves so he doesn’t have to turn to you for every expense.
Look into loss mitigation. HUD can help you with this, as can other experienced professionals.
Re-negotiate your loan with your lenders. Most lenders want nothing to do with foreclosing on a property and are likely to prefer re-negotiating rather than being forced to foreclose.