How to Handle Foreclosure

What to Do if Your Lender Has Already Filed for Foreclosure 

If you’ve fallen behind on your mortgage payments, your lender may file a foreclosure action. But, don’t despair, there are several steps you can take to avoid foreclosure and possibly save your home. Read on to learn what you can do to stop or delay the foreclosure process, and for strategies to get the help you need. 

Understand Your Situation

The first step to avoiding foreclosure is to know exactly what’s happening with your loan. Many people stop opening mail from the lender and stop answering their phone calls when they fall behind on payments. This, however, is one of the worst things you can do. Instead, remain open and communicative with the lender, since the more accurate information you both have the less likely that either of you will be caught off guard in an even more precarious situation. 

In most cases, lenders are required to wait at least 120 days before they can begin foreclosure proceedings. During this time, you may be able to negotiate a repayment arrangement or explore other options, such as obtaining a loan modification or selling the property. By understanding the status of your loan and actively communicating with the lender, you can develop a more informed plan and work toward avoiding a detrimental outcome. 

Seek Professional Help

In some cases, you may need to seek professional help in order to protect your rights and keep your home. A housing counselor, financial advisor, or lawyer can advise you on what steps to take to avoid foreclosure, or help you negotiate with your lender. HUD-approved housing counselors are available free of charge throughout the country and can provide impartial advice. 

Know Your Rights

It’s important to know your rights when it comes to foreclosure. Most states have laws that protect homeowners from wrongful foreclosure proceedings and inappropriately aggressive or intimidating tactics by lenders. For example, many states require lenders to wait 120 days following the first missed payment before beginning foreclosure proceedings. You may be able to use this time to negotiate repayment terms with your lender, or investigate other alternatives. An attorney or housing counselor can help you understand your rights and identify any potential legal violations. 

Consider Alternatives

If your lender has already filed for foreclosure, you may still have options available. You might be able to negotiate a forbearance agreement, loan modification, or repayment plan that would make it easier for you to stay current with future monthly payments. You may also be able to sell the property in order to pay off the outstanding balance of the loan, an arrangement called a short sale. The counselor or attorney may provide advice or suggestions on the best course of action for your particular situation. 

Talk to Your Lender

It’s important to communicate with your lender throughout the foreclosure process. The key is to remain civil, calm, and explain your situation in a clear manner. Always follow up on any written offers, and document any verbal agreements you make with your lender. Developing an effective communication strategy will help strengthen your bargaining position. 

Time is of the Essence

If you’ve already received notice from your lender that foreclosure proceedings have begun, it’s important to act quickly. Depending on where you live, you may only have a short time before the foreclosure process is completed and your home is sold or taken from you. Use the limited time you have available to explore all of your options and take necessary steps to protect yourself and keep your home, if possible. 

Foreclosure is a difficult situation, but it is definitely possible to overcome this challenge and keep your home. Because of the complexity of the legal and financial repercussions of foreclosure, it’s always best to work with an experienced advisor. With the right guidance and support, you may be able to successfully avoid foreclosure and get your mortgage payments back on track. 

If the sale of the property is ultimately the most appropriate action to take, make sure you work with the most reputable real estate agency in the area. In the greater Philadelphia area, that is Prosperity Real Estate & Investment Services. The experts at Prosperity REIS will help you arrange inspections, determine market value, and find cash buyers ready to close quickly. We understand the need for efficiency, as well as discretion, and our agents will make sure you are informed and comfortable. Give us a call today.