Consumer Information:
Foreclosure

What is foreclosure, and how do you prevent it?

The information below is provided as a public service from Debt-Tips.com. All of the information comes from various organizations, U.S. government agencies and departments. As a consumer, you owe it to yourself to know as much as possible about debt, credit, taxes, mortgages, banking – and avoiding related scams.

The information on this page involves foreclosure. Owning a house is the American Dream. However, it is also a big responsibility. Sometimes it becomes too big a financial burden for the homeowner, and ultimately can lead to foreclosure (the lender asking for full payment of the mortage because the borrower is not making the monthly mortgage payments).

The best way to avoid foreclosure is to make your mortgage payments on time each month. If this is not possible, you should contact your mortgage lender immediately to discuss your options. Most banks do not want to take your home, and only due so as a last resort. Working with them, rather than avoiding them, is often helpful:

How to Avoid Foreclosure

"Whether you're in foreclosure now or worried about it in the future, HUD (U.S. Dept. of Housing & Urban Development) has information that can help. HUD sponsors housing counseling agencies throughout the country that can provide advice on buying a home, renting, defaults, foreclosures, credit issues, and reverse mortgages.

Foreclosure processes are different in every state. If you are worried about making your mortgage payments, then you should learn about your state's foreclosure laws and processes. Differences among states range from the notices that must be posted or mailed, redemption periods, and the scheduling and notices issued regarding the auctioning of the property. In general, mortgage companies start foreclosure processes about 3-6 months after the first missed mortgage payment. Late fees are charged after 10-15 , however most mortgage companies recognize that homeowners may be facing short-term financial hardships. It is extremely important you stay in contact with your lender within the first month after missing a payment."

Are you struggling to pay your mortgage? Do you need help avoiding foreclosure?

Visit the HUD's website: Guide to Avoiding Foreclosure

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