You have kids, work hard at your job and didn’t expect to struggle with your health. Unfortunately, because you have had to finance so much lately, you haven’t had the money to provide payments on your home. What can you do to avoid going into foreclosure now that you’ve missed several payments? Here are two possible ways to stop the foreclosure process and get back on track.
Consider a short sale if your mortgage is underwater
One thing that can help you out if your mortgage costs more than it’s worth is a short sale. A short sale allows you to negotiate with the lender, so you can sell your home for a fair market price without having to pay the lender the difference in value. This does affect your credit score and can take several months to complete, so it’s a good idea to consider a short sale before you begin to struggle with making payments. Even if you already have missed some payments, this can still be a viable option that your attorney will bring up. A short sale may even come with a $1,500 relocation payment during the closing, so you have money to start over in an apartment or other location.
Look into renting out your home
If your mortgage is relatively low and you have some time before a foreclosure is imminent, consider renting the home to help catch up on your payments. For example, if your mortgage is $300 a month and your home can be rented for $1,200 in your area, the first month could potentially pay off three to four months of payments. You’ll need to find a different place to live unless you’re able to rent a single room or part of your home independently.
Your attorney can talk to you about many different options that you have when facing foreclosure. From selling your home to entering bankruptcy, there are ways to avoid a foreclosure.