Some homeowners face the problem of foreclosure when it comes to their home loan. This is obviously a very troubling time in any homeowner’s life as many people have been denied a mortgage modification or simply do not qualify for a form of mortgage assistance that will allow them to keep their home.
However, if a homeowner is faced with losing their home there are ways to avoid foreclosure so that a homeowner can steer clear of taking a big hit to their credit score and, avoid simply walking away from their home loan, which has been common among homeowners over the past months. The Home Affordable Foreclosure Alternatives Program has options for homeowners who are trying to avoid foreclosure and want to work with their lender if they are unable to afford their home.
There are programs such as the short sale program and the Deed–in–Lieu of Foreclosure program that can help homeowners who voluntarily surrender ownership of their property to their home loan provider. These programs have been used by various lenders in order to help homeowners who have been denied a modification, have not successfully completed a trial period for a modification or are delinquent on their Making Home Affordable modification.
Short sales have been used to help homeowners in these situations or those who have a severely underwater home. Many homeowners have simply walked away from their underwater mortgage so short sales were offered as an alternative to walking away or “strategic defaulting.”
Many Deed-in-Lieu of Foreclosure options were offered to homeowners who would surrender their property, knowing that they could not pay their home loan payment but also wanting to avoid trouble that comes with a foreclosure. While the use by and implementation of these programs have differed among lenders, homeowners who want to avoid foreclosure but cannot keep their home are being advised to talk to their lender about these alternative options.
Foreclosure prevention plans from the Making Home Affordable Program can be discussed with lenders or homeowners may want to consult the Making Home Affordable website for more details and qualifications for this type of mortgage assistance.