If you have been served a Notice of Foreclosure, it’s natural to panic. However, you should know there are several alternatives to foreclosure that may help you save your home, such as:
- Forbearance. If you are having trouble making your mortgage payments, loan forbearance may be a good option for you. Under a forbearance agreement the lender agrees to allow the homeowner to temporarily stop making payments until they have recovered from their financial problems. A forbearance wont excuse a homeowner from making his or her mortgage payments, and eventually the homeowner will have to repay the mortgage payments he or she missed. It simply delays payments until a later time.
- Loan Modification. You may be able to modify the terms of your existing mortgage loan to make your monthly mortgage payments more affordable. This might include lowering the interest rate, reducing the principal balance, changing your loan from an adjustable rate to a fix rate, or shortening or extending the life of the loan.
- Short Sale. In a short sale, the bank agrees to let you sell the house for less than it’s worth. In order for a short sale to work the lender must agree to it because they will be accepting a lower payoff than what the home is actually worth. The reason some lenders agree to this is because they'd rather have the house sold and collect some money than have to deal with a foreclosure.
Bankruptcy. Once a person files for Chapter 13, all debt collection actions taken against them, including foreclosure, must cease. Once you’re under the protection of
Chapter 13, you can reorganize your finances and work out a payment plan to pay off your debts over the next three to five years. You can include your mortgage debt in this plan so you are able to stay in your home.
- Deed in Lieu. A deed in lieu of foreclosure occurs when the homeowner agrees to give the deed of their home back to the lender because they can no longer afford the payments. The lender then sells the property in order to recuperate the remaining balance the homeowner still owes. Although the homeowner will not be able to stay in their home, they will avoid the negative effects associated with foreclosure.
At Pacific Attorney Group, we are committed to helping homeowners throughout Los Angeles stop foreclosure and stay in their homes. We know this is an unsettling time for you, and want to help in any way we can. If you are interested in learning more about your options in regards to fighting foreclosure, please do not hesitate to contact a
Los Angeles foreclosure defense attorney at our office today!