This article is intended to help a homeowner prolong the foreclosure process therefore possibly helping the owner save money, or if their circumstances change for the better during this duration even avoid foreclosure all together.
When a person gets behind on their mortgage payments the phone calls begin followed by letters telling the homeowner they are in danger of defaulting on their loan. The banks will sometimes offer you a solution such as doing a home modification loan. But lets say, you lost your job or your income doesn’t look as though its going to improve and you have a lot of credit card debt. If a person is in this predicament sometimes letting the banks proceed with the foreclosure might be the better scenario. Why would you want to do this? Possibly to buy yourself some time. Don’t panic – foreclosure is a procedure they can’t come and take away your house unless proper procedures are followed.
1. First find out how long the foreclosure process is taking in your county/ state.
Some areas in states such as Florida, Nevada and California are taking as long as 6 months to a year. This can buy you time to save money, pay off other debt or your life situation may change for the better in that time.
2. When you are first served your papers, READ them carefully!
If you do not understand them then find an attorney or better yet – look for a local chapter of the Legal Aid Society in your area that can help you read this document. You will have 30 days to respond back to this document ( a lawyer or the courthouse will tell you exactly how long you have to respond back) . DON’T JUST IGNORE IT!! READ IT!! You can sometimes even ask for an additional extension while you are having it reviewed – further delaying the process.
3. Make the banks prove their case
Many people were be served with papers that are just written with generalities and the document may even state that they don’t even have your mortgage note. This and several other “technicalities” can help you stay in your house longer. The law has been revised due to “foreclosure mills” that do not even have all of the proper documentation to foreclose on a property so now they must show documentation that the “note” is in their possession. With all the selling and reselling of mortgages they can sometimes get “lost”. Make them look for it and prove it.
4. Sell your house
Tell the bank you want to sell your house or do a “short sale” if your house is “underwater” in value. Price it a little high and show good faith to lower it on occasion. This could stall the foreclosure only if you have an offer. Every persons situation is different – you must first see if it will make sense for you. Why sell the house for the banks?
5. Ask for a home modification loan.
Unfortunately the reality is that only about 10% of homeowners get approved and you better read that document very carefully because all the interest that you haven’t been paying and fees etc. will be recouped by the bank. Work only with your bank – beware of other so called “mortgage scams” that say they will help you. Deal only with your bank! Also think how long do you want to commit to staying in the house because it may be SEVERAL years before the house may gain value again.
6. Ask for more time
At summary judgment you are entitled to go and in some cases you may request an extension possibly up to 3-6 months additional time. This may vary state to state so make sure you check all of your information as it pertains to your county/state.
Don’t be an ostrich with your head buried in the sand – stay involved. Remember its really not the end of the world and foreclosure is happening to millions of people so you are not alone!