Some Facts About Foreclosure That You Should Know

If you have obtained a home mortgage loan to buy your home and have failed to repay the mortgage, then your lender has the legitimate authority to foreclose your home. This means that he can lawfully repossess it and sell it off to utilize the sales proce

If you have obtained a home mortgage loan to buy your home and have failed to repay the mortgage, then your lender has the legitimate authority to foreclose your home. This means that he can lawfully repossess it and sell it off to utilize the sales proceeds to settle the mortgage. It is important that you know the facts about foreclosure.

When mortgage regulations came into existence, there was a stipulation that the holder of the mortgage or the mortgagee would seize the property of the defaulting homeowner routinely. However, with time, the regulations have been modified and the mortgagors were given additional time for repaying their loans prior to the repossession of their properties. Nevertheless, following foreclosure, if your lender can’t sell your home for the amount you are obliged to them, then there can be a deficiency judgment passed against you. Both a deficiency judgment and a foreclosure can get you into problems related to your credit.

What Are Your Alternatives To Foreclosure?

When you find that your property is on the verge of foreclosure, you can search for options rather than becoming anxious and wasting time:

Communicate with a housing counselor: Licensed counselors would assess your income, expenditures and debts and help you ascertain the most effective options that you can apply for your own advantage and prevent foreclosure.

Talk to your lender: You can request your lender and see if they offer you a repayment program with better terms and conditions. There are chances that they would co-operate with you. You can apply for a loan modification.

Borrowing money: You can borrow from your family members or friends to save yourself from foreclosure in case they are prepared to lend you.

Go for refinance: Refinancing your existing mortgage can save you from foreclosure through a reduced rate of interest.