Alternatives to Foreclosure

Your lender may be willing to work out an alternative to foreclosure that may help you save your home, or at least to prevent a foreclosure from ruining your credit.

 

Some alternatives include:

  1. Repayment Plan: Your lender may give you a fixed amount of time to repay the amount you are behind, plus any late fees, by adding a portion to your regular monthly payment. This is a good option if you only missed a few payments.
  2. Forbearance: Your lender may agree to suspend your payments for a period of time. At the end of this time, you will resume your regular monthly payments, and you may be required to either make one lump sum payment or additional partial payments. This may be a good option if you have a temporary reduction in income. 
  3. Loan Modification: Your lender may agree to reduce your interest rate, extend the term of the loan, or add missed payments to the loan balance. 
  4. Selling Your Home: Depending on the strength of the housing market in your area, selling may provide funds needed to pay the mortgage debt in full.  In a “Short Sale,” the lender allows you to sell and agrees to forgive any shortfall between the sale price and the mortgage balance.  A Short Sale will be less damaging to your credit than a foreclosure.
  5. Deed in Lieu of Foreclosure: You voluntarily transfer title to the lender in exchange for cancellation of the remainder of your debt, but you will lose any equity in the home and may have to pay taxes on the debt forgiven. A sale or a deed in lieu of foreclosure may be a better alternative than a foreclosure adversely affecting your credit.

If you have any questions please contact me:

Roy Wysack – Realtor, ABR, e-PRO, SFR
Keller Williams Realty,
Plymouth Market Center
40600 Ann Arbor Rd., Suite 100
Plymouth, MI 48170phone: 734.629.7222
FAX: 888.807.7832
E-mail: roy@waynecountyshortsales.com