One of the biggest issues that homeowners are facing right now is bank foreclosure. Many families are in danger of losing their homes due to defaulting on their mortgages. However, if you are facing foreclosure, there are ways you can get help. While there are some methods that can be enacted after foreclosure has been initiated, your best options will need to be take place before the bank foreclosure process begins.
Getting Help with a Bank Foreclosure
If you are concerned about foreclosure because you’re having difficulty making your house payments, the first thing you should do is to talk to your mortgage lender. In some cases, a lender may work with you to help avoid bank foreclosure by modifying or refinancing your loan. A third party lender may also be able to help.
Distressed borrowers can visit the main website of the U.S. Department of Housing and Urban Development (HUD) for foreclosure assistance. The HUD portal offers advice and resources to homeowners seeking information about bank foreclosures. You may also be able to visit a local HUD office or speak with a “foreclosure avoidance counselor” to help evaluate your situation.
The federal government currently offers two programs to help homeowners manage bank foreclosure: HOPE Now (www.hopenow.com) and Making Home Affordable (www.makinghomeaffordable.gov). HOPE Now is described as “an alliance between counselors, mortgage companies, investors, and other mortgage market participants.” The Making Home Affordable initiative gives homeowners the opportunity to modify or refinance their mortgage loans, or seek alternative foreclosure options. A mortgage lender can help you determine if you qualify for one of these programs.
Watch Out for Bank Foreclosure Scams
Homeowners who are worried about bank foreclosure may become desperate for help. Unfortunately, there are always fraudulent scammers who try to profit during such times by taking advantage of the inexperienced and unknowing. As you look for bank foreclosure help, you will need to be on guard for any scams that could end up making your situation a lot worse.
Some scams will promise to make all your foreclosure problems disappear ― as long as you pay them cash up-front. Do this and you could end up singing bogus paperwork, paying a large fee, and then never hearing from that company again. Despite your efforts, you are now out of money and the bank foreclosure process keeps pressing forward. In any situation, you should not trust someone who “promises” to take all your troubles away in exchange for an upfront fee.
In different foreclosure scam, the homeowner may be persuaded to sign their property over to a scam company which then becomes the deed holder. Although you can do your best to make payments to the bank (or even pay rent to the scammer), the house is no longer yours. Once the scammer obtains ownership of the property, they can evict you, leaving you with no place to live and zero home equity.
When seeking mortgage advice, be sure to speak with an HUD-approved counselor about your bank foreclosure. You can get a referral from HUD or check their website for a list of approved counselors. Verifying the credentials of every lender and counselor you deal with will greatly reduce your chances of becoming a victim.