If you're like many people who are currently facing the possibility of a foreclosure, you're undoubtedly feeling a mixture of anger, helplessness, and fear. You may also believe that once the bank has started the foreclosure process, you're powerless to stop it. However, you may have strong misgivings about the foreclosure moving forward — perhaps you don't want your credit rating to take the kind of major hit a foreclosure on your record would deliver, or maybe you simply want to find a way to stay in your home. Either way, you don't have to sit idly by and allow the bank to sell your home. Here's what you can do if you're facing foreclosure and want to stop the process or at least buy yourself some time.
File for Bankruptcy
Filing for bankruptcy won't help you retain a good credit score, but it can keep you from losing your house in some circumstances. As soon as your bankruptcy filing is official, all foreclosure activity on the part of the lending institution must legally stop. However, keep in mind that you still run the risk of losing your home after the bankruptcy is processed through the courts if you can't make the mortgage payments. This approach is best for those experiencing a temporary financial setback and need to buy themselves some time. For instance, if you've lost your job but find another by the time your bankruptcy comes before a judge, you'll probably be able to keep your house if you can resume the payments.
Work on a Short Sale
This option is best for those who know they won't be able to get back on track with their payments but want to get out from under their home without doing major damage to their credit rating. Even after they've filed foreclosure procedures, lending institutions still must consider all offers to purchase the property — in fact, most lenders prefer to go this route because it saves them time and money. A short sale is when you sell your home for less than the balance of your mortgage, with all of the proceeds going to the financial institution that holds the mortgage.
Negotiate With the Lender
Most lenders really don't want to foreclose on your property, so you may be able to steer the course in a different direction with the right negotiations. If you've missed a few mortgage payments due to temporary circumstances that resulted in a financial bind, you have a good chance of being able to negotiate a reasonable compromise with your bank if you're able to start making payments again. However, your chances for the best possible outcome will be better if you've got a skilled foreclosure law attorney working with you when dealing with the bank that holds the mortgage.
To learn more, contact a professional like Jeffery A Fournier Esquire today.