Financial Help to Stop Foreclosure

Foreclosure Explained

Foreclosure occurs when homeowners allow mortgage payments to become delinquent, or when property taxes go unpaid. The leinholder can legally force the homeowners out of the home and sell the home to recoup the money owed. It does not matter how much money is owed; foreclosures can occur over relatively small amounts of money as long as the money that is owed is not paid within the time span granted by the mortgage lender.

Find Financial Help to Stop Foreclosures

Just because foreclosure proceedings have began does not mean that the home cannot be saved. There are organizations that can assist homeowners with financial help to stop foreclosures:

• Housing Counseling Agencies are located in each state and can assist homeowners with financial help to stop foreclosures. These organizations also offer counseling for foreclosure avoidance.
• Mortgages insured through the VA may qualify for a product called refunding, which transfers the servicing of the loan over to the VA and allows the borrower to stay in the home while paying off the debt.
• Mortgages insured through FHA may qualify for a special one-time disbursement through HUD to bring the mortgage to current status.
• Certain non-profit organizations donate money to individuals to bring their mortgages up to date, but these grants are at the discretion of the organizations.

Proceed With Caution

When homeowners find out that their home is going into foreclosure they often experience an intense sense of panic. Even though it is logical that delinquent payments will result in foreclosure, when a notification arrives there still may be a resulting shock. Because of this, some homeowners may panic and unintentionally turn to companies or individuals who advertise foreclosure assistance but instead convince the homeowners to sell the home to them for a discounted price. If homeowners aren't careful, they'll wind up losing their home not from foreclosure, but through the dealings of a less-than scrupulous company that preys on desperate people.

Red Flags

Here are a few red flags which can alert you that the foreclosure assistance company you are dealing with is not necessarily looking out for your best interests:

• The company contacts you. Instead of you seeking out assistance, the company contacts you after the foreclosure papers have already been filed in court. Some companies scour through foreclosure filings (which are public record) in the hopes of stumbling upon homeowners desperate enough to sign over their homes.
• The company asks you to stop talking to your mortgage lender. If you are still in contact with your mortgage lender there is still a chance you may be able to work something out to avoid foreclosure. Foreclosure assistance scammers don't want you to retain your home.
• The company requires you to sign your deed over to them. If you sign over the deed the company then owns the home, but that does not mean that you don't still owe the money on the mortgage loan.
• The representatives of the company are pushy and vague in the details of the program. If you notice that the company representatives urge you to sign documents without allowing you to first review everything, then this can be a huge red flag.

If you feel as though you may be involved with a company that is out to take your home instead of actually helping you to avoid foreclosure then you should contact the Attorney General in your state.

Do Not Hesitate

Foreclosure can be terrifying, but this is no reason to avoid finding a solution. Some lenders will re-amortize the loan or even allow for skipped payments without penalties, but you must contact your lender before you fall behind if you hope to be considered for any of these programs.

Avoiding your mortgage lender out of fear or other reasons will result in the very real possibility of losing your home.