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10 Things You Must Know To Prevent Foreclosure

If you’re facing foreclosure, and would like to try to prevent foreclosure, follow these tips:

1. Pay your mortgage before any other expense. It is the top priority. You can do without the credit cards and live without utilities for a while, but you need a roof over your head.
2. Make your mortgage payments as close to the due date as possible, no more than 30 days from that date. There may be late fees after the 15^th, but as long as it is paid within the first 30 days, the bank cannot start the foreclosure process. The process usually begins after the 3^rd or 4^th month of missed payments
3. Always keep in contact with your lender. Let them know what is going on if you know you are going to be late or miss a payment. Keeping in communication is a top priority with your lender. Reply quickly to phone calls and letters. Lenders will be more flexible with someone who is mature and responsible.
4. Protect your credit by minimizing borrowing and credit card use. Live within your means.
5. Start an emergency fund by putting aside money every week. Try to have at least $2000 – $5000 set aside for emergencies only.
6. Get a home equity line of credit for use in an emergency.
7. Add job-loss or mortgage life insurance to your homeowner’s insurance policy. This coverage guarantees your mortgage payments will be paid if you lose your job or pass away unexpectedly.
8. Understand the rules and regulations governing credit and foreclosure. If you know your rights, you have a better chance of keeping your home.
9. Beware of scams if you are in foreclosure. Be wary of offers from buyers who want to buy out your mortgage and private counseling firms charging for their services
10. Know the bankruptcy law. Many homeowners facing foreclosure will file for bankruptcy to save their home. Bankruptcy might be a good option for some homeowners, but it should be avoided if possible.

It is possible to prevent foreclosure. By following these tips and knowing your rights you can save your home.

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