HOW TO AVOID FORECLOSURE

 Foreclosure is the legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan . When you buy a house, you sign a lot of documents and some of the documents you sign give the right to the bank to foreclose on your house if you miss a certain number of payments. 

 Once you miss three payments the bank records a document in the county recorders office of the county where the property is located at. That document is known as Notice of Default and that means the bank has started the foreclosure process.  

 The whole foreclosure process could take up to six and a half to seven months from the time you miss your first payment.  Three months after you receive the Notice of Default, you receive a Notice of Trustee Sale. The notice of trustee sale gives you the specific date and specific location where the actual Sale will take place.  

 Reinstating the loan:
The first option you have to take your home out of foreclosure is by reinstating the loan. Reinstating the loan will completely take you out of foreclosure.
Payment plan:
A payment plan can help you eventually catch up with your payments. You need to call your bank and ask them if that would be an option for you. What banks usually do is split the amount you are behind with and divide it in twelve months. If the bank gives you that option the way it works is that you start making your regular payment plus an additional amount every month until you come up current.
Loan Modification:
A loan modification is a process where the bank accepts to renegotiate and modify the original terms of the loan. This type of negotiation can result in the reduction of the interest rate and monthly payment. A Loan Modification can have a negative impact in your credit report and it is recommended to talk to a credit expert.
Sell the property:
When none of the above options work the only option you have is to sell the property. If you have enough equity you can sell the property and pay off the loan along with the late payments and fees and keep the remaining balance.
Do a Short Sale:
A short sale is one of the last resources you have when you can not make the payments any longer and there is no equity in your property. in this kind of negotiation you need to hire a Realtor to put the property in the market and usually that same person negotiates the terms with the bank. A short sale can have tax consequences and have a negative impact in your credit report that is why it is recommended to talk to a tax and credit expert before making that decision. 

 If you are behind with your payments it is recommended to look for help immediately.
How much does a loan modification cost?
A loan modification is free if you contact your lender and directly negotiate with them.
If you need to hire someone to do the work you don't have to pay anything at front but there will be a fee you will have to negotiate with whomever help you process the loan modification and pay it once the loan modification is approved. 

 If you have more questions about any of these options we can give you information at no cost to you.