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Fending Off Foreclosure Staff - Mortgage Lenders Plus.com

Those of us who have felt debt closing in on us like a rising tide know the shame that is associated with it. It’s that sense of failure that causes many people who face foreclosure to keep silent about it. That’s a mistake.

Many people who feel the desperation associated with avoiding foreclosure respond to the “Cash for your home!” sort of advertising that leads them right into the arms of a scam artist. Crooks who prey on people facing the loss of their home are counting on their targets to lack foreclosure information regarding their alternatives.

• The three main formats for homeowner aid scams are these:
  
  The scam artist charges outrageous fees for executing a few preliminary steps to obtain foreclosure information that the homeowner could have performed himself – leaving him poorer and no better off.

• The “bail out” scam involves the homeowner signing over title to the home with the understanding that they are avoiding foreclosure by renting the house for a while until they can buy it back. The terms of the buyback are impossible to meet, and the thief walks off with the home – and the equity.

• The “bait and switch” involves misrepresented documents. The homeowners sign papers they believe are meant to provide mortgage relief – thereby avoiding foreclosure - but in fact release ownership to the scam artist. These homeowners learn that they are no longer homeowners when they are evicted.

You don’t need to call an 800 number to get assistance if you face foreclosure. The first party you should speak with is your lender. Mortgage companies and banks prefer avoiding foreclosure almost as much as homeowners, and for the same reason. It costs them money – an average of $59,000 to execute a foreclosure and resell the home. Most lenders are willing to work out arrangements that relieve the pressure of the monthly mortgage payments or the overdue sum, if they believe the homeowner is genuine and will be able to regain solid footing.

One of the long term remedies if it is possible is refinancing from an ARM into a fixed rate mortgage. It will give you the long term stability of a fixed budget item. If there is a legal aid society in your community, seek foreclosure information from one of their attorneys. While you won’t be getting legal representation, you will get an accurate reading on your rights and the amount of time you have to find a solution. It’s possible that a call from the attorney may convince the lender that you are a candidate for a renegotiated loan.

The silver bullet in avoiding foreclosure is a bankruptcy filing. Your home cannot be taken from you. The mortgage lender becomes another creditor, with whom you can negotiate terms under the aegis of the court. Bankruptcy will throw your credit into limbo for years, but it may allow you to keep your home. Once again, bankruptcy as an option for avoiding foreclosure should be a decision made in conjunction with legal counsel.