Do you have to pay the full amount to avoid foreclosure?

by admin on August 28, 2010

Question:

Do you have to pay the full amount to avoid foreclosure?

Answer:

According to Freddy Mac, to avoid foreclosure, there are still other things that you can do aside from paying the full amount directly. One would be through refinancing wherein your lender will give you a new mortgage where you can attain enough equity in your home. Once your lender agrees to this option and you attain equity, you may be able to pay off the old mortgage and fees. Another option would be reinstatement where you will be allowed to pay what’s behind your mortgage in one lump sum at a later date.

If you have an income tax return or are expecting a large amount of money coming your way, this would be the best option for you. The third way in order to avoid foreclosure is through forebearance wherein you will be able to suspend your payments for a limited time. This way, you will be able to raise your income and eventually make your payments. A loan modification would also be a good choice. In here, you and your lender would agree to change the terms of your mortgage to make it more affordable for you.

Lastly, you may apply for President Obama’s Making Homes Affordable plan. You may ask your lender whether or not this plan can help you.

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