For many people, the reality of their home being foreclosed on is a feeling of devastation and fear. The current economy is such that many families are drowning in debt as they deal with lost work hours and/or unemployment. If you stick to a budget, you have an advantage over most homeowners. You can literally project when your money will run out, which can help you find help much sooner than most. However, if you’re like many others without a budget, you probably have day-to-day anxiety wondering when the foreclosure notices will start arriving in the mail. Do not panic.
First, decide if you want to fight for your home. After the scare you realize that it is too expensive or it is not a house that you really want to keep. If this is the case, start saving as much money as you can and begin the process of transitioning to an affordable living arrangement. You should have a plan in place before you contact your lender. Be sure to research and discuss the options of doing a short sale, deed-in-lieu of foreclosure, or going through the foreclosure process. Regardless of what you choose, simply walking away (also called a “strategic default or abandonment”) is not the way you should handle this situation. It is in your best interest to speak with a local real estate agent when putting together your plan.
Now, if you decide that this house is worth fighting for, start a folder with all the documents related to the property. Review your budget or create a budget to figure out how much you can afford each month. Be sure to eliminate all unnecessary expenses before you arrive at your final figure. Contact a counselor for help. The government has a very informative website called Making Home Affordable (http://www.makinghomeaffordable.gov). This is a great resource for homeowners facing foreclosure. They have several programs that might work for you despite your current circumstances. Be prepared to send them copies of income, property, and budget information if requested. You may also want to talk to an attorney about the pros and cons of filing for bankruptcy so you can keep your home as well. Most offer a free consultation related to foreclosures.
Even though fear may be just around the corner, you should find some relief by taking active steps to make the right decision and face the problem head-on. Many families are dealing with the foreclosure process, so you are not alone. However, how you choose to deal with this unfortunate dilemma makes all the difference in the world. -Good luck!