Can Loan Modification Stop Foreclosure?
The answer is a resounding yes — it can stop foreclosure. However, you have to be really brave, because there will be rough waters ahead. The truth is, it’s not really difficult, but the process usually is. And chances are, you will have to summon a lot of patience and willpower to push through to the end.
Usually, homeowners who have temporary job losses, illnesses, rate adjustments, and other short-term hardships can avail of loan modification. Most bankers may also ask you to modify your loans during the early stages of a possible foreclosure. As with anything in life, the best attack is to nip the bud at its very early stages to avoid serious damages in the long run. So if you feel that you are now heading towards an impending foreclosure, it is best to go to the bank as soon as you can to avoid complications.
The reason behind this is simple — foreclosure proceedings take quite a long time to process. It begins as soon as you miss your payment even for a day, but it will not be officially declared until you are 3-4 months due and the mortgage company has hired a legal attorney to file the foreclosure paperwork in the court system. The entire process may take as little as 21 days, while others may even go for as long as a year. It all depends on your State’s Foreclosure laws, so it’s best to acquaint yourself with its mandates as much as you can.
In addition to this, make sure that you do not exceed 30 days. Usually, once you reach past this mark, the mortgage company will not accept your past due payments without your current one. So, if your typical payment is $1,500/mo. and you are 45 days past due, they will want you to pay you $3,000 ($1000 for your past due payment plus $1000 for your current one). They are quite strict on this, and they will send back your payments if they are not complete.
Always remember that you can choose not to lose your home. Stay positive, and don’t be scared to ask the advice of bankers and lenders on how you can stop foreclosure. Their guidance might prove to be the most valuable one in getting your home back where they belong.
