If you are unable to meet the terms of your mortgage loan, there is a strong possibility that your lending institution will take foreclosure action against you. Your mortgage lender, which holds a lien on your house, has the legal right to take possession of your home should you default on your loan agreement. The mortgage banker can then re-sell the house in the attempt to recover their losses.

Steps to Stop Foreclosure

Know that there are steps that you can take to stop a foreclosure on your property. Most lenders will offer refinancing help as a means to avoid assuming ownership of the property since they do not want to be responsible for taxes, upkeep and possibly renting out properties until they can be sold. They will often work with the homeowner to avoid foreclosure.

One manner of debt relief is a reduction in the amount of your monthly mortgage payment or even a temporary suspension of payments. Your lender may consider setting up a new payment schedule. Your lender may offer to break down past due payments into installments over a set period of time, six months for example, with the monthly payment due along with one sixth of the past due amount until the past due amount is paid.

You may want to consider taking a foreclosure loan, which is a loan offered by lending institutions across the country to keep properties from being foreclosed. When you get a foreclosure loan, the company providing that loan will buy your debt from your original financial institution. The benefit of having a secondary company taking over your mortgage debt is that you should be able to negotiate longer terms, smaller monthly payments and possibly lower interest rates. The loan officer of the bank that currently holds your mortgage or your realtor are both good sources from which to get the names of reputable foreclosure loan agencies.

Filing for bankruptcy may become necessary if the homeowner’s financial state has reached the point where it is the only alternative. When claiming bankruptcy, the homeowner may be able to work with both the courts and the lender to establish a payment plan that allows him to keep his home while paying most of the past due interest charges and late fees. This plan also benefits the mortgage holder since they would not have to go through the foreclosure process.

There is a somewhat erroneous notion that taking a second mortgage can offer relief for possible home foreclosure. In reality, if a homeowner cannot afford to make the monthly payments on an original mortgage, there is little chance that a lender would be willing to arrange for another loan. Even if the homeowner could find an institution willing to make the loan, the homeowner would probably be unable to make payments on both of the loans. The exception to this is if a very short-term loan is needed to make the payments on your first mortgage. This could be a possibility if, for example, if you have been let go from your job but have a firm offer for a new job that will be starting in a month or two.



If you are experiencing an emergency that is impeding your ability to pay your monthly payments, such as a job loss, family illness, death or divorce, it is of the utmost importance to let your lender know. You can then assure them that you understand your responsibility and will do your best to make your payments. You may find that by communicating with your lending institution, there are ways for you to meet your mortgage responsibility and stop possible foreclosure.

Important for You to Know When Stopping a Foreclosure It is crucial that you respond to and keep records of all correspondence from your lending institution, including face-to-face conversations, phone calls, e-mails, faxes and letters. It is also a very good idea to keep a log of all of these communications. This log should keep track of dates and times, who initiated the contact, content, any agreements that were made and the names of those with whom you communicated.

You will also need to continue to keep exact records of payments that you have made toward the mortgage. Even if these are only partial payments, they will demonstrate your intent in meeting your financial obligations.

Consulting with an ethical credit counseling service may give you some refinancing strategies that you have not previously considered. However, know that you are probably feeling very vulnerable and be wary of any deal that sound too good to be true as it probably is. You’re going to need more Refinancing Tips and strategies before making any decisions. Foreclosure is a serious issue, and you need to speak with an experienced professional as soon as you can. Fill out our free contact form to find out what you need to know in order to halt that pending foreclosure right now.