Introduction
When all else fails, a homeowner facing foreclosure isn’t without a few resources up his sleeve. While these last minute efforts shouldn’t be used until there aren’t any other choices remaining, many homeowners have found them invaluable for stopping foreclosure and saving their homes. Some are more commonly known than others, and this list is not all inclusive. Your situation may differ from those that find these methods successful options. Still, they are options and can be used to save your home.
Deed-In-Lieu of Foreclosure
It is possible to get a deed-in-lieu of foreclosure, but your lender will probably want to see that every effort has been made prior to agreeing to this option. The lender doesn’t want to be a real estate owner and doing this will make him one. However, he will be willing to accept this when all other options are exhausted because there are a few benefits for the lender. The loss on the loan for the lender will be less with a deed-in-lieu. It doesn’t cost the lender as much as the pursued foreclosure and it takes less time to see a recuperation of funds for the lender than a foreclosure does.
Chapter 7 Bankruptcy
Chapter seven bankruptcies may be an option for the desperate homeowner. However, be careful with this option and fully understand your state’s individual laws concerning chapter seven bankruptcies as you may or may not be able to keep your home by choosing chapter seven bankruptcy. It all depends upon the limitations of each individual state has in place for this type of bankruptcy. If your equity is more than the allotted amount, more than likely you will be forced to sell the home under the provisions of chapter seven bankruptcies.
Chapter 13 Bankruptcy
If the goal is to keep your home and there are no options left, chapter 13 bankruptcy may be for you. This type of bankruptcy allows you to pay off the back amount owed over time, which can be up to five years. Just be aware that you must also make your current mortgage payments at the same time. If all payments are made and the conditions of the proposal for repayment under chapter 13 are fully met, you will be able to stop foreclosure and hold onto your home.
If your house has dropped in value due to depreciation, it is possible that a chapter 13 bankruptcy can eliminate a second and third mortgage. This can happen when your first mortgage has all value of your home tied into it and there isn’t an adequate amount of equity left to secure the second and third mortgages. If this is the case, then your second and third mortgages will be reclassified as unsecured debt. Unsecured debt is the lowest priority in a chapter 13 bankruptcy and often doesn’t have to be paid back at all.
Related posts:
- Best Strategies Revealed on Safely Walking Away From Your Home
- Bankruptcy Vs Foreclosure: Which Is Better?
- Facing Foreclosure? Here Are 6 Options to Keep Your House
- 6 Ways To Sell Your House Fast To Stop Foreclosure
Tags: Chapter 13 bankruptcy, Chapter 7 Bankruptcy, deed in lieu of foreclosure, Deed-in-lieu, deedinlieu, Foreclosure Help, Stop Foreclosure, stop home foreclosure