What are my alternatives?
Your options include the following.
Special Forbearance. We may be able to arrange a repayment plan which would be based upon your financial situation and may even provide for a temporary reduction or suspension of your payments. You may qualify for this if you have recently experienced an involuntary reduction in income or an increase in living expenses. You must have also furnished information to show that you would be able to meet the requirements of the new payment plan.
Mortgage Modification. We may be able to refinance the debt and / or extend the term of your mortgage loan. This will help you catch up by possibly reducing the monthly payments to a more affordable level. You may qualify if you have recovered from a financial problem but your net income is less than it was before the default (failure to pay).
Partial Claim. We may be able to obtain an interest-free loan from HUD to bring your mortgage current. You may qualify if: 1) your loan is at least 4 months delinquent and no more than 12 months delifnquent; 2) your mortgage is not in foreclosure and; 3) you are able to begin making full mortgage payments. When your lender files a Partial Claim, the US Department of Housing and Urban Development will pay yoru lender the amount necessary to bring your mortgage current. You must execute a Promissory Note and a Lien will be placed on your property until the Promissory Note is paid in full. The Promissory Note is interest-free, and will be due if you sell or leave your property, or when your mortgage matures.
Pre-foreclosure sale. This will allow you to sell your property and pay off your motgage loan to avoid foreclosure and damage to your credit rating. You may qualify if: 1) the “as is” appraised value is at least 70% of the amount you owe and the sales price is 95% of the appraised value; 2) the loan is at least 2 months delinquent prior to the pre-foreclosure sale closing date; 3) you are able to sell your house within 3 to 5 months (depending on what your lender agrees to). An additional benefit to this option is the assistance you will receive with the Seller-paid closing costs.
Deed-in-lieu of foreclosure. At a last resort, you may be able to voluntarily “give back” your property to the lender. This won’t save your house, but it will help your chances of getting another mortgage loan in the future. You can qualify if: 1) you are in default and don’t qualify for any of the other options; 2) your attempts at selling the house before foreclosure were unsuccessful; 3) you don’’t have another FHA mortgage in default.
How do I know if I qualify for any of these alternatives?
A housing counseling agency can help you determine which, if any of these optiosn may meet your needs. To find out more information, contact us now.
How does YMS help?
Your Mortgage Solutions will work with you to get your payments back on track. We specialize in ensuring that our customers are able to find a way to work with their lenders to resume making proper payments on their homes, and in some cases without making all of their back payments to their lender and without going to court.
We understand that all people at some time or another will go through a financial hardship, but this shouldn’t mean that you should lose your home and have the stigma of having lost your home to foreclosure. Our objective is to work with you to ensure that you can work through this rough time and come out on the other side in a situation that enables you to go about your life without the worry and fear that foreclosure brings.