Stopping Foreclosure Through Lender Mediation
You've had more than your share of difficulties in the last few months. You've lost a loved one or been through a difficult divorce. You've lost a job or had to change jobs. You've lost your health and have medical expenses stacking up. Maybe you're struggling with increased utility prices or fuel expenses or an adjustable rate mortgage (ARM) that is unbearable. Perhaps, your property tax bill has gone through the roof.
Unfortunately, while you're worrying about stopping foreclosure of your home, you're bombarded with letters, postcards, phone calls and strangers driving by and knocking on your door.
These foreclosure investors specialize in chasing homeowners just like you who are close to losing their homes. They're interested in buying your home and profiting from it, because they believe you must sell the home.
Should you sell to an investor to avoid being foreclosed on? Maybe, but certainly not as your first option. And only after you exhausted other foreclosure prevention means such as rearranging your loan.
One of the Solutions To Stop Foreclosure Is Lender Mediation
Once you have missed a couple of payments, your credit rating will begin to be affected your credit score will likely drop considerably, which will make it extremely difficult to refinance your current loan.
However, mortgage lenders would really rather not end up owning your home; this is why every mortgage lender has a loss mitigation department which tries to work with homeowners who are in default on their mortgages to bring them back onto a timely payment schedule. Unlike refinancing your mortgage with a new loan, this loss mitigation process does not require getting a credit approval, putting this alternative within reach for homeowners who are in default.
If You Do Get a Workout Plan, Beware of the Challenges
One of the biggest problems with these loss mitigation departments is they don't employ enough people to handle unusually high rates of foreclosure the country is experiencing right now. In fact, these plans are often difficult to arrange due to the heavy workload, which these employees are faced with. Since loss mitigation departments have so little time available to work with each file, they will tend to offer repayment plans which don't give you enough time to catch up with your payments, and monthly payments which are larger than you can realistically afford.
Because you're between a rock and a hard place you're tempted to take it to keep your home from being foreclosed on. In reality you just set yourself up for a failure. A few months down the stretch, you'll be back in foreclosure again.
How to Hire Foreclosure Workout Professionals
One of the simplest, yet little known ways to get a lot better outcome through the Loss Mitigation process is to hire an experienced professional to do the work for you. These are companies that have experience of negotiating literally thousands of workout cases for owners in default. Some have established working relationships with the Loss Mitigation departments of many mortgage lenders nationwide.
These companies will look over your finances and help you come up with a repayment schedule, which is possible for you to meet; payments will be kept as low as possible to make it easier for you to make your payments. These companies have intimate knowledge of the programs offered by different lenders and can negotiate a better deal for you than you would be offered by the lender on your own. They may even be able to negotiate a lower interest rate on your mortgage, which will lower your payments.
You may think that these services will be too expensive, given your financial difficulties; however, most of these services charge a low flat fee, usually about a months payment. With the money and time these negotiations can save you, they usually more than pay for themselves? They can often even negotiate a deferral of your next payment.
You May Consider Cutting Your Losses
If the lender mediation process won't work for you, then you will need to sell your home to keep from having a foreclosure record on your credit report. If there is enough time before foreclosure, you best bet is to list your home with a realtor, this will let you get a better price for your home. If your foreclosure is imminent, however, you may have no alternative but to sell to an investor. These companies can buy your home quickly, just make sure that they have the means to close the deal quickly, before your home goes into foreclosure.
Unfortunately, while you're worrying about stopping foreclosure of your home, you're bombarded with letters, postcards, phone calls and strangers driving by and knocking on your door.
These foreclosure investors specialize in chasing homeowners just like you who are close to losing their homes. They're interested in buying your home and profiting from it, because they believe you must sell the home.
Should you sell to an investor to avoid being foreclosed on? Maybe, but certainly not as your first option. And only after you exhausted other foreclosure prevention means such as rearranging your loan.
One of the Solutions To Stop Foreclosure Is Lender Mediation
Once you have missed a couple of payments, your credit rating will begin to be affected your credit score will likely drop considerably, which will make it extremely difficult to refinance your current loan.
However, mortgage lenders would really rather not end up owning your home; this is why every mortgage lender has a loss mitigation department which tries to work with homeowners who are in default on their mortgages to bring them back onto a timely payment schedule. Unlike refinancing your mortgage with a new loan, this loss mitigation process does not require getting a credit approval, putting this alternative within reach for homeowners who are in default.
If You Do Get a Workout Plan, Beware of the Challenges
One of the biggest problems with these loss mitigation departments is they don't employ enough people to handle unusually high rates of foreclosure the country is experiencing right now. In fact, these plans are often difficult to arrange due to the heavy workload, which these employees are faced with. Since loss mitigation departments have so little time available to work with each file, they will tend to offer repayment plans which don't give you enough time to catch up with your payments, and monthly payments which are larger than you can realistically afford.
Because you're between a rock and a hard place you're tempted to take it to keep your home from being foreclosed on. In reality you just set yourself up for a failure. A few months down the stretch, you'll be back in foreclosure again.
How to Hire Foreclosure Workout Professionals
One of the simplest, yet little known ways to get a lot better outcome through the Loss Mitigation process is to hire an experienced professional to do the work for you. These are companies that have experience of negotiating literally thousands of workout cases for owners in default. Some have established working relationships with the Loss Mitigation departments of many mortgage lenders nationwide.
These companies will look over your finances and help you come up with a repayment schedule, which is possible for you to meet; payments will be kept as low as possible to make it easier for you to make your payments. These companies have intimate knowledge of the programs offered by different lenders and can negotiate a better deal for you than you would be offered by the lender on your own. They may even be able to negotiate a lower interest rate on your mortgage, which will lower your payments.
You may think that these services will be too expensive, given your financial difficulties; however, most of these services charge a low flat fee, usually about a months payment. With the money and time these negotiations can save you, they usually more than pay for themselves? They can often even negotiate a deferral of your next payment.
You May Consider Cutting Your Losses
If the lender mediation process won't work for you, then you will need to sell your home to keep from having a foreclosure record on your credit report. If there is enough time before foreclosure, you best bet is to list your home with a realtor, this will let you get a better price for your home. If your foreclosure is imminent, however, you may have no alternative but to sell to an investor. These companies can buy your home quickly, just make sure that they have the means to close the deal quickly, before your home goes into foreclosure.
About the Author:
It's time for you to stop foreclosure of your home through loss mitigation. Don't delay and start looking for a referral to loss mitigation .
posted by Credit Counseling at
2:59 PM
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