Strategies to Avoid Foreclosure
- Be proactive about the problem when the first warning signs appear. Not only does this reduce the stress of not knowing what is going to happen but it makes it easier for creditors to work out a plan. See the early warning signs.
- Contact your lender when you become aware that you have a problem. The last thing that a lender wants is to foreclose on the property. Financial institutions lose a significant amount of money by foreclosing on a property ($50,000+/-). Foreclosure is a lose/lose for the lender and the homeowner. It is important to be honest and forthright with your discussions and be prepared to discuss the reason for your problems.
- Read the mail. Not knowing does not solve the problem it just delays the final result and increases the pain. By not reading the mail a person avoids the opportunity to get help before it is too late.
- Contact a HUD approved housing counselor or call a Realtor (612-237-6853) for advice. To find a nearby HUD counselor call 1-800-569-4287 or go to www.hud.gov.
- Prioritize your spending by paying for the necessities of life first. Always pay for things like food, house payments, utilities and health insurance first.
- Look for ways to generate cash. Sell those items that have value but are not used or needed, or seek a part time job to get through the crisis. Not only does this reduce the emotional and financial stress but it provides evidence to the lender that the borrower is proactively seeking a way to remedy a bad situation.
- Don’t get scammed by a private “foreclosure prevention specialist,” instead go to www.hud.gov or see a call a Realtor (612-237-6853) to obtain valid information about foreclosure prevention.
- Make an appointment with a Realtor to discuss the problem and to get their advice. Seek an agent who has obtained the SFR (Short Sale and Foreclosure Resource) designation. Request a detailed market analysis and review all options.
