Foreclosure — The Big Bad Bank Against Helpless Little You — Wrong!
You may be very surprised to hear this, but even if you are behind in your mortgage payments, it still isn’t really like the bank just can’t wait to get its hands on your home. In fact, the bank doesn’t want your home at all! The bank wants cash, and they will work with you to help them get their cash, and help you keep your home.
Here is the very first thing you must do. Talk to your lender. Ignore all the “good advice” out there that says you should avoid letting your lender know that you are in financial trouble. That “advice” often comes from foreclosure scammers whose goal is to get between you and your lender and take advantage of you while you are having financial trouble.
Mortgage lenders are not in business to judge your past actions, and they don’t want your house. Remember that “The Bank” is staffed by people just like you – people who have problems and fears just like you do. These people don’t want a foreclosure any more than you do.
But it’s a fact that the longer you wait to share your problems with your lender, the harder you make it for them to help you. If you are months behind on your payments and your lender has heard nothing from you, they can only assume that you are defaulting on your loan and they are going to be forced into foreclosing on your house.
That is why you must take action immediately to protect your home from foreclosure and keep your credit record from being harmed.
It will probably be embarrassing, but you need to be honest and open with your lender about the details of your financial problems. If you have prepared yourself well with the facts and details of your current problems, your lender will be more likely to see you as truly looking for a joint solution to your financial struggles, and not just looking for a way to leave the lender with a bad loan. Be ready with the following information for your lender.
How Did You Get Into This Situation?
The lender knows that even good people can have bad things happen to them: medical crises, family problems, job loss, etc. Be ready with facts and exact numbers, but do not go on and on about your problems.
What Are Your Monthly Expenses Besides Your Mortgage?
Only consider essential expenses and obligations. This is not a wish list for things you would like to have. Only list real financial requirements, such as food, utilities, credit card payments or other loans, child or spousal support, etc
How Much Money Do You Have Every Month?
Count everything: jobs, unemployment or disability insurance, welfare benefits, food stamps, etc., along with any savings or investments you may have.
How Do You Plan To Solve This Problem?
Think about all possibilities, including how you can deal with your problems now and in the future. Be honest with your lender, even if you feel like your situation is totally hopeless. Your lender may know of ways to get financial help that you don’t know about, including possibilities for reducing losses (yours and the lender’s) and ideas for preventing foreclosure.
A foreclosure will probably ruin your credit record for years, so take all the time and work you need to identify and consider every possibility for improving your financial situation.
Keep in mind that you and lender both want to prevent a foreclosure on your home. The lender just wants to get paid on the loan that was made, and you want to stay in your home and save your credit standing.
By working as a team, you and your lender may be able to come up with a solution that works for both of you, but don’t forget that you must step up to the plate and take action to help yourself.