Foreclosure McAllen TX: How to Prevent Property Foreclosure on Your House?

Foreclosure McAllen TX: How can you save your house from foreclosure?

After owning an underwater house, foreclosure is the worst thing that can happen to a homeowner. No one dreams of losing their house to the bank although there is an exit clause included in mortgage payments. We believe we will never go through such times which is a good thing. However, we must hope for the best but always plan for the worst.

This article is written for homeowners who are in default or fear their homes will be foreclosed because of financial problems.

Foreclosure McAllen TX: How to Prevent Foreclosure on Your Property?

Awareness is important. Because if you are not aware of your options, you cannot solve the problem. Receiving the default notice does not mean the bank will foreclose your house. Seizing your house while trying to make a profit is an expensive activity. The lenders never want to foreclose your house. Instead, they want you to pay the loan. Only when you cannot fulfill the obligation and when all other options have failed, the bank has to foreclose the property.

You can use this fact to your advantage. Get yourself some time and try to solve the financial equation.

Foreclosure McAllen TX: Loan Reinstatement

Most households have an asset that can be turned into cash. You can take a secondary job. You can sell luxury items, tap into your retirement accounts, sell your vehicle or anything that can potentially save your house. If you can qualify, apply for a second loan that can cover pending mortgage payments. You receive the default notice after 60 days of missing the first loan installment. You get 30-60 days to reinstate your loan.

Take action quickly. Loan reinstatement is the best option to save your house.

Foreclosure McAllen TX: Loan Forbearance

You must apply for loan forbearance before or immediately after missing your first loan installment. Most lenders won’t agree on forbearance after they send you a default notice. During the forbearance period, the lender suspends your mortgage payments for a while. There is no fixed duration. You can discuss the length & terms of the forbearance period with your lender.

This option works best if you are facing temporary financial problems such as a job loss, bodily injury or a financial setback. The accumulated balance of the forbearance period can be paid as a lump sum immediately or at the end of the 30-year period or your monthly payment may increase as a result.

Foreclosure McAllen TX: Home Affordable Modification Program

FHA HAMP program can answer your question. To qualify, the house must be your primary residence and you must continue living in the house for several years. Home Affordable Modification Program can help you modify your mortgage in a way that suits your income. If successful, the program can reduce your monthly installment by 40%. The lenders may agree to reduce interest rates or the length of your plan is extended by several years.

Foreclosure McAllen TX: File for Bankruptcy

Do you own an underwater house? Would you like to get rid of this financial burden?

A short sale is the best solution. However, if your lender does not agree to a short sale and the proceeds from foreclosure won’t pay off your mortgage then bankruptcy can eliminate your debts.

If you are earning less than the state median ($44,254) then you are eligible for Chapter 7 bankruptcy. Chapter 7 bankruptcy will liquidate your assets but the court will discharge any debts you have.

The problem with underwater houses is that you are held liable to pay the deficiency balance. Similarly, if you took a mortgage of $350,000 and your home sells for $320,000 then you are responsible to pay the remaining $30,000. It is not a question that you cannot pay this substantial amount. That’s why sometimes, it pays to file bankruptcy. Please consult a bankruptcy attorney and a HUD approved counselor before taking a decision. Feel free to contact us for more information.

Foreclosure McAllen TX: Sell Your House

Losing your house to the foreclosure has long-term consequences. A foreclosure stays on your credit report for 7 years. It can prevent you from taking a new job, a new apartment for rent and you cannot buy a house for seven years.

If you believe that your income has shifted permanently and you cannot pay your mortgage, then it is best to sell your house. It is an exit strategy that will eliminate your debts without having a negative impact on your credit score. You can buy a new house whenever your financial situation becomes stable. You can start a new life without the emotional baggage of a foreclosure or bankruptcy.

Contact us now to read more about this option.

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