Pre Foreclosure : What to do to Ensure You Won’t Lose Your Home

A pre foreclosure simply means that the property is in the early phase of being repossessed by the lender due to non-payment. It usually is after three or more months of payment default. The mortgage lender sends a default notice that warns of impending legal action in case that the debt is not paid.

Once you receive a foreclosure notice in the pre foreclosure stage, immediately take action

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It is so unfortunate that many people are reaching this stage, and many are getting crazy thinking about what needs to be done when they receive a notice from their bank that in a few months or so, they will be facing foreclosure. There are some who do not worry about it too much, and they don’t find out what to do until they face the actual repossession. As a responsible individual though, you should start finding out options and ways to avoid foreclosure on your home, even if you are still on the pre foreclosure stage.

Here are some things you can do during the stage of pre foreclosure:

Talk to your lender.

This is the best thing you can do, especially if you still don’t know where you can get money to make a payment, or when you can pay them. Talking to you lenders will make them feel your willingness to do something about the situation, aside from that, you can start making a payment plan because you will have the chance to tell them your current financial situation.

Modify loan.

Again, this requires that you communicate with your lender. This way, they may give you some adjustment on interest, amount and time frame when you can make a payment.

Pay up.

If the default amount is something that can be covered by your savings, then you could probably make the payment. You may also want to take out a personal loan and get your property out of pre-foreclosure.

Sell the house.

If you think that making monthly payments will be a problem for a long time, then you should probably think of selling the house. Doing so will enable you to ask for a higher price, more than what you can get if you wait for the lenders to sell the property. Look for an investor, or a family member who can give you a reasonable amount in exchange for your home. This is really a tough choice to make, but in the long run, it can truly be the best and most helpful option.

Going through this phase in your life is truly painful losing your home which you have worked so hard for. Receiving a letter that you are on default and will be foreclosed, the feeling is surely quite agonizing. While still at the pre foreclosure stage be proactive and learn your options to save your home.

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