Avoiding Foreclosure - About foreclosure prevention
You have problems with covering your foreclosure payments? And your lender is already looking for ways to discuss this problem with you?
If your situation is similar to one described, then the following tips are for you:
1. Pay attention on your problem.
If you do nothing to solve problems with mortgage payments, you are likely to loose your foreclosed homes after all.
2.If you understand that you can't cover the payment, talk to the lender.
Actually lender doesn't want to get your foreclosed home, thats why he has a possibility to help you to stop foreclosure.
3. Try to give answers to all lenders e-mails.
Often the first e-mails you obtain inform you about the description of the suitable%best options to avoid foreclosure.
This information can be very important and useful. As well e-mails may inform you about dates of legal actions. If you ignore the mail it will not be accepted as an excuse in the court.
4. Learn your rights.
It is highly recommended to look through the mortgage documents to be informed about the possible results of your financial crisis. In order to reach the foreclosure prevention it would be very useful to be informed about main mortgage laws in your state.
5. Be informed about the available options to avoid foreclosure.
Internet is a great source of information about foreclosure problems.
6. Use help provided by HUD professionals.
The HUD of USA provides consulting for all clients in the United States.
Professionals from HUD will provide you with information about dealing with law, with assist you in financial questions, also you can get useful tips for having serious talk with your lender.
7. Set priorities in spending money.
Look through list of your main spendings and then cut these spendings, so you will get additional source of money to cover your mortgage loan. But it will be needed to set your needs in range of importance, so for example healthcare will be of highest importance, but such spheres of spending money as transport expenditures, payments for cable TV, night clubs are of lower priority and can become a source of mortgage payments. House payments should be one of the first priority expenditures in family budget.
8. Earn money with your assets for avoiding foreclosure.
Everybody has such assets as some golden or silver rings, maybe second car or insurance policy or other assets which can be sold in any moment to solve financial problems with foreclosure payments. Maybe one of your family members can find a work to to help to cover mortgage payments. It is not a way to increase your income to very high level, but it will show the lender your desire to save the home and to avoid foreclosure.
9. Don't pay money for free advices.
If you are suggested to pay for help in avoiding foreclosure, it is better to refuse and pay for foreclosure instead of spending money for it.
There will always be a number of organizations giving you a lot of promises and trying to profit from your situation. But informational services, lender or House and Urban Development professionals will proved all needed information not charging money from you.
10. Don't sign any documents without reading them carefully.
Before signing the official document, look through them paying attention at each detail, because you may loose your home. These documents may say, that you are letting somebody to act on your behalf. It is better to trust counselors from HUD in order to stop foreclosure.
Number of bank foreclosures are growing daily. Its more than 100 millions properties in United States and near 4% or 4.8 million of them are facing foreclosure. Many homeowners are lucky to stop the foreclosure process, but, there were about 500,000 homes of them which are listed in bank owned properites last year.
Post foreclosures (REO)
REO property or real estate owned property belongs to banks. How does it happen that banks own a real estate? Well, it is easy to understand: bank gives a loan, so mortgage appears, if client cant pay his dept and if there are no ways of foreclosure avoiding, the house becomes the property of financial organization. It may seem that foreclosures can’t bring high profits as bank want to sell it offering the price which will at least cover the amount of the first loan. On the other hand, if you will be more attentive, you will see some ways to benefit greatly from buying a foreclosure house.
It may be the situation, when more then one loan is secured to the real estate; actually it happens quite often nowadays. In case second lender doesn’t make payments to the first lender and starts own foreclosure procedure, in this case the second lender is not part of foreclosure process any more. That is the main reason why plenty of second mortgages are valued around 20% less then the normal market price.
Bank doesn’t benefit from being an owner of a house; it needs money to flow constantly to get higher net profit. More over keeping a foreclosure as an asset may cause additional expenses. That is why bank wants to sell this burden as soon as possible, and it is likely to accept even not high price, just to cover the dept.