June 18, 2024


Mad about real estate

Mortgage Loan- Foreclosure Dilemma

What should you do if you are faced with foreclosure problems because of nonpayment’s of your mortgage loans?  There are many reasons why borrowers are delinquent in their payments. Reasons like illness, injury, separation or divorce, and loss of job. Due to the global economic problems, people are getting laid off from their jobs.  Many find themselves with no income, and struggle to make ends meet. In this kind of situations every aspect of the family life gets affected. It is always difficult to put food on the table and consequently, making payments for your loan is next to impossible.

The rule in mortgage loans is once the borrower fails to pay his payments, the bank have the right to sell the property in order to be able to recover its money. That’s why they have to foreclose the property. Foreclosing the property means you loss the ownership and the rights to it. So what should one do when your property is foreclosed?

Foreclosure should not be allowed to happen it should be prevented at all cost. The best way of stopping it is by talking to the lending company and negotiates. Never ignore letters sent to you. Contact them immediately and explain to them. Plead if you must about your present predicament. There is nothing better than to have an open communication with the other parties.  Show to them that you are facing your problem and not ignoring it.  Besides failure to open letters sent to you is not an excuse in foreclosure courts. Lenders do not actually want your house what they really want is for you to honor you debts and they have the option to help you during your tough financial times.

You can also have third party assistance, by refinancing your mortgage loan. Refinance mortgage loan is a subsequent mortgage loan of a property which has been already mortgage earlier to be able to secure a loan. This is done for many reasons, one is to increase the length of time of the first loan, to lower the interest rate, to be able to secure much needed extra cash, and to reduce any risk that the first loan has.

The important thing to remember during difficult financial times is you always have options available to you. Your house might be in danger of being foreclosed, do not lose hope. Do not be ashamed to ask for help. Your lending company is not your enemy here but your ally. Talk to them about your problem .Lenders might be able to give you other way for you to be able to make your payments especially if they see that you do not have the intention of abandoning your duties. They could change the terms of your loan from adjustable rate type of loan to a more manageable rate. It is also possible to extend the amortization period. Some lenders also allow their borrowers to a repayment plan wherein the missed payments are spread out over a longer term.  Ignoring the foreclosure problem doesn’t solve anything at all. So face the problem head on and do not lose hope for lenders are always willing to help by providing other options for you.