Foreclosure alternative plans from servicers like J.P. Morgan Chase, among others, have been sought out by homeowners who were unsuccessful with foreclosure prevention programs, like home loan modifications, and have been granted to certain individuals as a way to forgo the foreclosure process despite losing their home. Obviously, the situation that a homeowner is in will be dependent upon their ability to qualify for a short sale or a deed in lieu of foreclosure plan, but servicers like Chase have been reportedly offering more of these alternatives to homeowners in need.
As an example, the October 2010 Making Home Affordable Servicer Report indicated that J.P. Morgan Chase saw an increase in the number of foreclosure alternatives offered to homeowners. The September 2010 HAMP report stated, as of August, J.P. Morgan Chase had made 4,052 short sale or deed in lieu of foreclosure plans available to homeowners who were not accepted into a trial modification within the Making Home Affordable Program. That number increased to 6,864 homeowners in the same category, as reported by the October Making Home Affordable report, which tracked this data through September.
Also, for homeowners who had their trial modification canceled, the September report for J.P. Morgan Chase showed 3,489 foreclosure alternative plans in progress, but 3,975 short sale or deed in lieu of foreclosure programs for homeowners with a canceled modification, as reported by the October 2010 servicer report.
Obviously, not all homeowners may qualify for these foreclosure alternatives plans, as some individuals, like those attempting to short sell their home, may be unable to find a buyer or may not be approved by their mortgage servicer. However, financial institutions within the Making Home Affordable Program are still offering these options which may allow certain homeowners to avoid the foreclosure process despite the fact that they can no longer afford their monthly mortgage payment.
Homeowners who had previously had no trouble making their mortgage payment but suddenly came upon a difficult financial time in their life may have a better opportunity at certain foreclosure alternatives, which could allow them to reenter the housing market easier once they find themselves in a more financially stable position. However, homeowners who feel that foreclosure may be inevitable are being advised to contact their servicer in order to begin qualifying for either a deed in lieu of foreclosure plan or start the process of short selling their home.