Avoiding foreclosure can be an extremely beneficial proposition for homeowners. By doing things like refinancing, you can help take out lower-interest mortgages, potentially saving tens of thousands over the life of your home loan.
You may also want to consider modifying your loan with your mortgage provider. Your lender will often be open to this modification if you’re only a few months behind on payments and if it expects that you’ll soon resume paying normally. Another option is principal reduction; lenders typically don’t like to do this because they lose money when that happens, but they will sometimes agree to principal reduction if they feel confident that it will help keep you in the home and able to pay down your loans more quickly.
The Keys of How To Avoid Foreclosure in Colorado Springs Don’t Abandon Ship
Dealing with a foreclosure on your record can be stressful, but isn’t the end of the world. Here are some steps you can take to get back on your feet after you deal with losing your home through foreclosure.
1. Look at Your Credit Report for Errors
It’s important to check your credit report for errors, before looking into purchasing a new home. This will allow you to clean up any problems with your credit score before applying for loans and will ensure that there aren’t any mistakes preventing you from getting another mortgage. Contact the three major credit bureaus (Equifax, Experian, and Transunion) where you can view your credit report for free. You will be able to see whether or not there are any accounts listed on the reports.
While it’s extremely stressful, you do have options:
• Negotiate with your mortgage lender. Banks and other financial institutions are well aware that citizens of Colorado Springs are struggling. If you haven’t missed a payment yet, you may have some leverage to renegotiate the terms of your loan. Banks don’t like foreclosing on homes, and many will work with you if you aren’t too far behind. You may be offered forbearance or even a full loan modification.
• Ask for help from Uncle Sam. Over the last five years, the federal government has implemented a number of programs to help struggling homeowners. The Home Affordable Modification Program (HAMP) allows struggling homeowners to modify their loans, reducing monthly payments. The Home Affordable Refinance Program allows homeowners who are current on their mortgage payments to refinance an adjustable-rate mortgage into a low-interest, fixed-rate loan. Both of these programs are subject to eligibility requirements.
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Thank you! HBR Colorado. All rights reserved. Disclaimer: The information on this website has not been evaluated by the Federal Housing Administration or any other government agency and may not be accurate and truthful. It should not be used for pre-qualification purposes and should only be used as an indication of your interest in this property program offered through a participating lender.