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Need to Refinance to Stop Foreclosure

By Edited Nov 24, 2016 2 2

When the bank begins the process to take your house, you may realize that you need to refinance to stop foreclosure. Of course, there are plenty of high risk mortgage lenders out there, but there are also some inherent dangers with using them. Still, if you are in the process of losing your home to the bank, you may need to refinance to stop foreclosure. If you do nothing, you are sure to lose your house to the bank. Let's look at some things to consider when you find yourself in this jam.

 

Real Government Help

 

Have you suffered a substantial decrease in income?  The Housing and Urban Development (HUD) is offering homeowners that have suffered a substantial decrease in income a chance to get a no interest, bridgeable loan from the government.  EHLP, Emergency Homeowner Loan Program could be just what you need.

 

 

About high risk lenders:

 

Even since the banking industry got a virtual slap in the face, there are still plenty of options when you need to refinance to stop foreclosure. Many high risk lenders will still guarantee approval regardless of your credit score. Of course, there are some things to consider when you use high risk, guaranteed approval loan lenders. Don't be fooled by claims of competitive rates, and guaranteed approval for high risk loans. When you need to refinance to stop foreclosure, you want to make sure you don't end up worse off than when you started out. Still, you can negotiate a refi with bad credit in some cases.

Interest rates: If you need to refinance to stop foreclosure, you can generally expect to pay a very high rate of interest. This should be no surprise, since those facing this type of situation will generally have very bad credit scores. When you deal with a guaranteed approval lenders, you will pay more, but you may be able to save your home. While this may be your only option when you need to refinance to stop foreclosure, it may be harmful in the future.

Amount to borrow: Many guaranteed approval lenders will only borrow you a certain amount of money. This may be okay, if you can get by with only paying arrears and late penalties. If you need to refinance to stop foreclosure, this may be a great option, when you can keep the loan value as low as possible. You will save money this way, have smaller payments each month, and hopefully save your home. When you need to refinance to stop foreclosure, it really helps if you borrow the least amount possible to get by.

Length of loan: When you need to refinance to stop foreclosure, you will need to consider the length of the loan. If you can afford to make the payments for a shorter guaranteed loan, you should do it. When you stretch out the payments, you pay much more interest over the life of the loan. This can lead to trouble down the road, should you run into financial woes again. When you need refinance to stop foreclosure, it really helps to think beyond the present.

 

 

Improving odds:

 

When you realize you need to refinance to stop foreclosure, you will want to do some things to help improve the odds of getting the high risk mortgage approved. While there are no guarantees that any one method will work, you can help your chances, especially if you use multiple methods. This is really about saving your house, and keeping the bank at bay. When you need to refinance to stop foreclosure, it's really about doing whatever you can to improve your chances of saving your house.

Communicate with the bank: You have certain legal rights. The bank, for example, must attempt to work out a repayment plan with you. This is your chance to save your house. If you need to refinance to stop foreclosure, you actually may be able to pull it off just by communicating with your local bank. You can also check out sample hardship letters to help stop foreclosure and possibly give you the time you need to refinance.

Respond to every letter: You will be sent several letters throughout this process. By responding to each and every letter or phone call, you will show that you are working, or at least attempting to work with, the bank. When you need to refinance to stop foreclosure, you need to make sure you cover yourself this way.

Negotiate: You must attempt to negotiate with your bank. When you need to refinance to stop foreclosure, you may be able to negotiate a lower rate to save your home. Perhaps you can get the bank to drop the late penalties, or start over fresh. If they reduce the amount of fees and penalties, you may be able to get a loan to cover the amount. When you find the need to refinance to refinance to stop foreclosure, you have some wiggle room for negotiations.

Show up at court: When you need to refinance to stop foreclosure, you should be sure to show up at the court hearing. If you do, you can simply ask the judge for a little more time. If you let the judge know you are working on a loan, you may get a short extension. If you have been communicating with the bank along the way, it will help you out. When you need to refinance to stop foreclosure, you will find the courts are willing to work with you, if you are making appropriate efforts.

Hire a lawyer: Many times, people skip the court date, or go at it on their own. If you need to refinance to stop foreclosure, a lawyer may be able to get you a little more time to make it happen. This will generally be short term, but it really can work. Lawyers know the routine, and they can really help you save your home during the court process. When you need to refinance to stop foreclosure, an attorney may help buy you the time to get it done. It's worth a shot.

Raising money: When you realize you need to refinance to stop foreclosure, and you are not having much luck with getting approved for the loan, it may be wise to raise some additional funds. This can help buy you some additional time to save your home from the bank. Even if you are only making small payments, you are showing a willingness to pay, and work on your debt obligation. If the process goes to court, you will have a much better chance of getting an extension.

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Comments

Nov 25, 2009 10:46pm
ladybugblue
All good ideas in these hard time regarding foreclosure.
Nov 30, 2009 1:14pm
thehigherstandard
It is amazing how many homeowners facing foreclosure simply stick their heads in the sand and ignore the reality of the problem. In today's down economy, banks do not want your house; they want performing loans, even if that means they have to give a discount to get them! Utilizing the steps set forth in your article will certainly help the average homeowner get back on track and save his or home. Good article!
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