Foreclosure avoidance counseling is FREE, and available to all Homeowners.  If an “NED” has been filed on your home you are scheduled to go into foreclosure in approx 125 days from the date of the”NED” Filing.  For more information regarding the Foreclosure Process visit Knowing The Foreclosure Process page.  If you are facing foreclosure just know you have options!  However, time is of the essence.  The Hightower Team specializes in helping people understand their options.  Don’t lose your home to Foreclosure!  Please don’t hesitate to call us for FREE assistance at 303-325-5020.

9 Options when facing Foreclosure:

1. Do Nothing: If a Homeowner does nothing, they most likely will lose their home at a foreclosure auction.  Loan applications generally ask if the applicant has ever had a foreclosure.  Credit reports also disclose this damaging information. Therefore, doing nothing may not be the best option.

 

2. Payoff/Refinance: A Homeowner may pay off the entire loan amount plus any default amount and fees. Usually this is accomplished through a refinance of the debt.  New debt may be at a higher interest rate and there may be a prepayment penalty because of the recent default.  If you choose this option you will want to make sure there is equity in the home.

 

3. Reinstatement or “Cure”: A Homeowner may choose to pay the entire default amount plus interest, attorney fees, late fees, taxes, missed payments, and any other potential fees.

 

4. Loan Modification: A Homeowner may utilize the existing mortgage company to refinance the debt or extend the terms of the loan.  This may allow the Homeowner to catch up at a more affordable level.  To qualify, you must prove to the lender you have fixed the problems that caused the late payments and provide supporting income and employment documentation.

 

5. Forbearance: The lender may be able to arrange a repayment plan based on the Homeowners financial situation.  The lender may even be able to provide a temporary payment reduction or suspension of payments.  The lender will require information to show that the Homeowner is able to meet the new payment plan requirements.

 

6. Partial Claims: A Homeowner may apply for a loan from the lender to pay off a 2nd loan demand. This includes back payments, costs, and fees.

 

7. Deed in Lieu of Foreclosure: A Homeowner may give the property back to the bank instead of waiting for the bank to foreclose.  Banks generally require all mortgage payments and taxes are current and home to be well maintained.  Most loan applications ask if the applicant has ever provided a deed in lieu of foreclosure.

 

8. Bankruptcy: A Homeowner should consult with a qualified bankruptcy attorney prior to selecting this option.  There are three types of bankruptcy options:
   • Chapter 7 (Liquidation) To settle personal debt.
   • Chapter 11 (Business Reorganization) A business debt solution.
   • Chapter 13 (Wage Earner Plan) A payment plan to pay off debts in 3-5 years.
9. Sale: If the property has equity (money remaining after all loans, closing costs, and monetary encumbrances are paid), the homeowner may sell the home without lender approval through the home sale process.  In this case the homeowner will receive cash from the sale, paid at close of escrow.  On the other hand, if the amount owed on the loan is MORE than the property’s current market value, a Short Sale can be negotiated with your lender.

Making Home Affordable: Avoid Foreclosure

Options under Making Home Affordable:

1. (HAFA) Home Affordable Foreclosure Alternatives
2. (HAMP) Home Affordable Modification Program
3. (HARP) Home Affordable Refinance Program
4. (2MP) Second Lien Modification Program