|
Training for Book Authors
|
|
|
Other Resources for Book Authors & Publishers
|
|
|
Please Support Our Advertisers
|
|
|
|
|
|
How Foreclosures Work and Steps You Can Take To Avoid Foreclosure
Copyright (c) 2006-2023 Jeff Spellman
Purchasing a home is a huge step in any person's life and it requires a great deal of commitment from the buyer. When you stop to consider that you are going to be repaying the mortgage on your home for many years to come, it is easy to see what a huge commitment buying a home really is.
Unfortunately, many people get overwhelmed with financial difficulties and get behind in making those mortgage payments. Some people struggle with paying their mortgage because of unforeseen medical expenses, the loss of a job, and getting in over their head with credit card debt. No matter what the reason is that they find themselves in financial distress, it is critical that they attempt to keep their home, their largest financial investment, from being foreclosed.
The Legal Definition of Foreclosure
In simple terms, a foreclosure is when the lender attempts to obtain possession of a property that the lender had loaned money to the borrower to purchase. A lender provides you with a mortgage and the home is considered to be collateral until you pay off the mortgage in full and with interest. If you stop making payments on your mortgage, the lender has the legal right to foreclose and take possession of your home in order to recoup the money that they originally loaned you. Any equity that you have built up over the years by making payments will be lost, since you will no longer have legal possession of the house.
The foreclosure allows the lender to declare the entire amount of the debt on the property to be due immediately. Failure to pay off the debt in full will result in the lender being able to take legal possession of the house or property. The lender is then able to sell the property, to pay for any remaining debt that is owed to the lender.
The foreclosure process varies from state to state. You will need to check out the specific foreclosure laws in your particular state to understand the exact process that is followed in your state. The most common processes are court proceedings and grants of power to the lender to sell the property.
Be Aware Of The Fine Print In Your Mortgage Papers
Most lenders will have an acceleration clause in the loan paperwork that says if you miss a number of payments over a period of time that the lender may implement this clause. The acceleration clause simply says that the lender has the right to foreclose on the property if the payments are not made in a timely manner. Many states regulate acceleration clauses and allow late payments to avoid foreclosure. In some instances, the acceleration clause will stipulate that you are not only responsible for the principal, but also the total interest financed when a foreclosure is implemented.
A Bird In The Hand...
Lenders, like people, come in many forms and can be quite understanding at times or rather demanding at other times. Your particular lender, and their policies, can dictate how quick they are to act on a foreclosure and how willing they are to work with you to resolve your financial issues without implementing a foreclosure process.
Ultimately, most lenders would rather have the cash than having to deal with the process of foreclosing on a house and then selling it. If bankers wanted to be real estate salesmen they would have went into real estate instead. For the lender, the old saying, "a bird in the hand is better than two in the bush" is very pertinent to the question of foreclosure. You are already in the home, and it would be far easier to get you to pay for the home than it would be to put it up on the market. Sure, the bank could profit handsomely by absorbing your equity, but they could potentially lose big if the house were to sit on the market unsold for many years.
It is often recommended that you work with your lender if you are experiencing financial problems and are unable to make your mortgage payments. Lenders frequently have to deal with people who simply ignore the warning letters that they receive, instead of contacting the lender to try to work something out with them. By contacting your lender at the first sign of distress, you have shown more concern and resolve than most borrowers who find themselves experiencing financial problems.
Have The Courage To Act Instead of React
These words of Oliver Wendell Holmes are as valid today as when Holmes uttered them in the 19th century. Most people react passively to foreclosure proceedings, allowing the sky to fall around them. Yet, had they the courage and conviction to take positive action, they could have avoided the loss of their home and the years of bad credit that comes with a home foreclosure.
It is imperative that you review all of the clauses in your mortgage paperwork, so that you are fully educated on the circumstances that could lead to foreclosure with your particular lender. Again, it is also important for you to know what your state's law is regarding foreclosures. If you need help understanding all of the legalese associated with financial documents, loans, contracts and foreclosures, you might consider hiring a professional to help you through the difficulties of the process.
Losing your home to a foreclosure could be devastating in many ways. Not only do you lose your home, but also you lose all of the equity that you have acquired during the years that you have been paying on your home. This equity that you have obtained is often considered a financial asset, and as a financial asset, it will help to ensure your ability to recover financially once you have gotten through this difficult time in your life. Additionally, you will want to avoid foreclosure, because your credit rating will be dramatically impacted in a negative way as a result of a foreclosure.
Whatever financial difficulties you might be facing right now are likely short-term in nature, but a home foreclosure could haunt your credit for seven years. If you go so far as filing for bankruptcy, your credit will be harmed for a period of ten years. Keep in mind --- and this is very important --- at the end of the seven-year and ten-year windows, it is your individual responsibility to contact the credit reporting bureaus, to have them delete the foreclosure and bankruptcy records from your credit report. These stains on your credit record will not drop off automatically at the end of the recommended time period.
Given the importance of protecting your financial assets and your credit rating, you need to take whatever steps are necessary to help you avoid letting these difficult months that you are facing now tarnish your financial reputation for many years to come.
Despite the pressures you might feel right now in your financial situation, this IS NOT a time to be cutting corners, by trying to navigate these difficult waters on your own. People, who in the past have hired a professional financial-services specialist to help them through this difficult process, generally consider that expense to be some of the best money they ever spent.
There is still hope for getting through this difficult situation, so long as you do not choose to give up all hope.
VOTE ON THIS ARTICLE
Needs Work >>
0 -
1 -
2 -
3 -
4 -
5
<< Excellent Article
Tell our authors what you think about their article.
|
Top-Level Category: Finance Articles || Related Categories: Real Estate Articles
10 Most Recent Articles Written by Jeff Spellman
How To Beat Your Banker At Their Own Game Using Loopholes In Their Own Rules
Written by: Jeff Spellman |
Distributed: 2006-12-26 |
Word Count: 854 |
Page Views: 3811
| Votes: 15 |
Rating: 2.20
Imagine what it would be like if you could pay off your mortgage
sooner than anticipated. Sure, we all think about it, we tell
ourselves that next year we will start paying more than is
required each month, or that once we pay off the car loan, we can
put more money to that mortgage. Unfortunately, many homeowners
never seem to have that extra money to put towards their mortgage
payments.
All of Author's Articles on this site: Jeff Spellman Articles
Most Recent "Finance" Articles
Credit Card Companies Reward Consumers Who Shop Around
Written by: Braxton Heitz |
Distributed: 2012-11-20 |
Word Count: 1159 |
Page Views: 7440
| Votes: 15 |
Rating: 1.80
With Ronald Reagan came mass deregulation in many industries. One
of the industries that benefited from deregulation was the
financial industry. As a result, hundreds of new financial
companies were introduced to the American consumer during the
1980's. With the sudden explosion of new competitors in this
industry, credit card companies began to struggle with how to
retain existing customers and to recruit new customers.
What My Mother Taught Me About Credit Cards And Family Finances
Written by: Braxton Heitz |
Distributed: 2012-11-12 |
Word Count: 1285 |
Page Views: 7405
| Votes: 31 |
Rating: 2.39
My mother is an amazing woman. She made some of the hardest jobs
imaginable look easy. No matter how hard her day was, she always
had a smile and perfect hair.
Understanding Your 401(k), IRA and Other Pre-Tax Investments
Written by: Irene A. Majchrzak |
Distributed: 2010-08-03 |
Word Count: 1005 |
Page Views: 5158
| Votes: 3 |
Rating: 2.00
What does all of the bad economic news mean to you, the
average investor. Well, if you are still working and
contributing to your pre-tax 401(k)'s, 403(b)'s, or IRA
savings your strategies for salvaging your retirement will
include reviewing all of the investment options found in
your 401(k), etc.
Xerox Follow Apple on the Comeback Trail
Written by: Jennifer Robinson |
Distributed: 2010-07-27 |
Word Count: 1238 |
Page Views: 5817
| Votes: 5 |
Rating: 0.20
In many ways the companies share similar fortunes. Apple
(founded by Steve Jobs, Stephen Wozniak, Ronald Wayne)
produced the first successful personal computer with a
graphical operating system. Xerox (founded by Chester
Carlson, Joseph C Wilson) were the inventors of Xerography
(later called the photocopier).
Payday Advance Loans Are Now Only One Toll Free Call Away
Written by: Tom Tierney |
Distributed: 2010-07-27 |
Word Count: 599 |
Page Views: 4181
| Votes: 2 |
Rating: 0.50
A friend of mine recently went through financial troubles
and asked me, knowing that I'm a finance writer, if I could
push him in the right direction for a short term loan to
help out with his expenses. Here's his story:
Stock Market Falls Sharply
Written by: Irene A. Majchrzak |
Distributed: 2010-07-27 |
Word Count: 879 |
Page Views: 4728
| Votes: 6 |
Rating: 0.83
The stock market has been having a bad week. Wednesday the
market ended the day down over 300 points. I heard reports
that this was the result of investors taking their profits.
Happens all the time. Then within a few days, the prices on
many great stocks is so low that the investors are buying
the stocks right back up.
Finding the Best Credit Card Applications
Written by: Jeffrey Weber |
Distributed: 2010-07-27 |
Word Count: 403 |
Page Views: 3766
| Votes: 2 |
Rating: 0.00
Online credit card applications can be confusing. That's
the way the banks want them. This article will help
eliminate some of the confusion.
Do You Know the Difference Between an Investment Advisor and a Broker?
Written by: Tome Tomaj |
Distributed: 2010-03-11 |
Word Count: 408 |
Page Views: 4554
| Votes: 6 |
Rating: 3.00
As an fee-only investment advisor I come across clients from
all walks of life. Lately I have noticed something in common
with many of these investors. Many do not know the
difference between an investment advisor and a broker who
manages and/or makes securities recommendations for their
clients' investment portfolios. With the almost
unprecedented volatility in the securities markets, you
cannot afford to dig your head in the sand when it comes to
whom is managing your assets.
Understanding Term Life Insurance and Getting Quotes
Written by: Brian Greenberg |
Distributed: 2010-01-13 |
Word Count: 520 |
Page Views: 4513
| Votes: 3 |
Rating: 1.00
Buying term life insurance can be a scary process but
understanding the different types of life insurance can
remove the fear. What you should know about term life and
how requesting life insurance quotes online can be easy and
very convenient.
The Decline in the Personal Savings Rate - What Happened to the Discipline?
Written by: Tome Tomaj |
Distributed: 2009-12-15 |
Word Count: 873 |
Page Views: 5178
| Votes: 6 |
Rating: 1.33
As more and more American baby boomers are nearing and
entering their retirement years, many of them are concerned
about whether their retirement savings will last them long
enough to ensure their current quality of life, and rightly
so.
Most Viewed "Finance" Articles
A Better Way To Sell A Structured Settlement - Via Auction
Written by: Clayton Frantz |
Distributed: 2007-11-30 |
Word Count: 1342 |
Page Views: 11920
| Votes: 12 |
Rating: 1.92
Structured settlements were introduced in Canada and the United
States in the 1970's. They were introduced as an alternative to
lump sum payments, common in insurance settlements and lottery
winnings. In the decades since, they have also been accepted as
legal financial instruments in England and Australia. In a
nutshell, a structured settlement by legal definition is a
statutory agreement to pay a specified sum of money over a period
of time, on a payment system.
Using a 401K Loan to Stop Foreclosure
Written by: Daniel Lamaute |
Distributed: 2008-02-11 |
Word Count: 465 |
Page Views: 10809
| Votes: 19 |
Rating: 1.79
A bankruptcy or foreclosure can cripple one's ability to obtain
decent credit for many years. In addition, some employers and
landlords won't hire or rent to a candidate with terrible credit
history. Thus, it is a good idea to discuss all options with a
financial planner before ending in bankruptcy or foreclosure.
What Does Short, Long, Flat And Square Mean In Forex Trading?
Written by: Sam Beatson |
Distributed: 2006-10-11 |
Word Count: 525 |
Page Views: 8643
| Votes: 22 |
Rating: 2.68
Short, long, square and flat explained in terms of forex trading
(Spot FX).
Why Over 3,000 US Companies Have Chosen the Frankfurt Stock Exchange to Go Public
Written by: Ron Crowe |
Distributed: 2008-07-31 |
Word Count: 786 |
Page Views: 8576
| Votes: 18 |
Rating: 1.83
The Frankfurt Stock Exchange, one of the world's largest trading
centers for securities, has over 3,000 United States companies
listed. North American and other foreign companies are choosing
Europe, over the United States, to go public because of the
punishing Sarbanes Oxley Act introduced in the United States in
2002.
Advantages and Disadvantages of Individual and Group Health Insurance
Written by: Kevin Kielty |
Distributed: 2009-04-01 |
Word Count: 639 |
Page Views: 7705
| Votes: 14 |
Rating: 2.00
The cost of individual and group health insurance coverage varies
greatly as does the type of coverage they both offer. Making the
switch can bring some surprises.
How to Hide Assets
Written by: Rocco Beatrice |
Distributed: 2007-01-19 |
Word Count: 507 |
Page Views: 7542
| Votes: 12 |
Rating: 1.08
How to hide your assets by repositioning your assets through an
irrevocable trust with an independent trustee.
Credit Card Companies Reward Consumers Who Shop Around
Written by: Braxton Heitz |
Distributed: 2012-11-20 |
Word Count: 1159 |
Page Views: 7440
| Votes: 15 |
Rating: 1.80
With Ronald Reagan came mass deregulation in many industries. One
of the industries that benefited from deregulation was the
financial industry. As a result, hundreds of new financial
companies were introduced to the American consumer during the
1980's. With the sudden explosion of new competitors in this
industry, credit card companies began to struggle with how to
retain existing customers and to recruit new customers.
What My Mother Taught Me About Credit Cards And Family Finances
Written by: Braxton Heitz |
Distributed: 2012-11-12 |
Word Count: 1285 |
Page Views: 7405
| Votes: 31 |
Rating: 2.39
My mother is an amazing woman. She made some of the hardest jobs
imaginable look easy. No matter how hard her day was, she always
had a smile and perfect hair.
The Effect of Inflation and Deflation on Retirees
Written by: Irene A. Majchrzak |
Distributed: 2009-10-27 |
Word Count: 1324 |
Page Views: 6680
| Votes: 7 |
Rating: 0.86
When we worry about how long our retirement income will
last, we consider so many factors. The current economy is
causing a drain on 401(k)'s and IRA's. So we have become
much more cautious about withdrawing money to use it as part
of our pensions.
How to Avoid Private Mortgage Insurance (PMI)
Written by: Jim Cramer |
Distributed: 2008-02-20 |
Word Count: 523 |
Page Views: 6594
| Votes: 8 |
Rating: 2.00
There is more than one way to get your desired home without
having the 20 percent down payment and avoid PMI at the same
time.
Highest Ranked "Finance" Articles
Identity Theft: The New Threat to Your Credit
Written by: Josh Pike |
Distributed: 2006-08-24 |
Word Count: 363 |
Page Views: 4939
| Votes: 16 |
Rating: 3.00
When we think of thieves, images of burglars creeping into homes
and apartments come to mind. However, there are new thieves that
can take much more than your money or possessions. If your
personal information falls into the hands of an identity thief,
your credit and finances can be ruined.
In Fear of Retirement
Written by: Daniel Lamaute |
Distributed: 2008-05-08 |
Word Count: 646 |
Page Views: 4359
| Votes: 9 |
Rating: 3.00
Many baby boomers are staring at retirement like a deer caught on
oncoming headlights. They are not sure what to do or what else to
do. They fear that whatever they have in savings just might not
be enough. Less than 1 out of 5 workers felt very confident about
having enough money for a comfortable retirement, according to
the April 2008, EBRI Retirement Confidence Survey. And with good
reasons, inflation is zooming at the same time that asset values
are flagging.
Do You Know the Difference Between an Investment Advisor and a Broker?
Written by: Tome Tomaj |
Distributed: 2010-03-11 |
Word Count: 408 |
Page Views: 4554
| Votes: 6 |
Rating: 3.00
As an fee-only investment advisor I come across clients from
all walks of life. Lately I have noticed something in common
with many of these investors. Many do not know the
difference between an investment advisor and a broker who
manages and/or makes securities recommendations for their
clients' investment portfolios. With the almost
unprecedented volatility in the securities markets, you
cannot afford to dig your head in the sand when it comes to
whom is managing your assets.
Medicaid Asset Protection
Written by: Rocco Beatrice |
Distributed: 2007-01-23 |
Word Count: 646 |
Page Views: 4713
| Votes: 9 |
Rating: 2.78
Learn how to include senior Medicaid asset protection as part of
your senior tax planning strategies. What are the tax
implications of Medicaid and why it needs to be planned
carefully? About seniors Medicaid asset protection as part of the
senior tax planning strategies. Explains the new 5-year look back
provisions for seniors to qualify for Medicare assistance into
nursing home program.
How Do You Make Money In Currency Trading?
Written by: Tom Howze |
Distributed: 2007-12-05 |
Word Count: 727 |
Page Views: 3839
| Votes: 9 |
Rating: 2.78
The question, "How do you make money in currency trading?" is
being asked by investors and potential investors worldwide as
they witness the multi-year downturn trend of the US dollar and
upswings in other currencies such as the Euro or Canadian Dollar.
Equipment Financing and The Five Cs of Credit Evaluation
Written by: Sean Marten |
Distributed: 2007-10-17 |
Word Count: 698 |
Page Views: 4500
| Votes: 8 |
Rating: 2.75
Equipment financing lenders, as well as banks, use the Five Cs to
evaluate loan applications: Character, Credit, Cash Flow,
Capacity and Collateral. However, while banks look at
small-to-medium size companies from a Fortune 500 perspective,
equipment financing companies see applicants from a small
business perspective, which highlights a sixth C: Common Sense.
Reverse Mortgage Costs Are Not Too High
Written by: N. Sioris |
Distributed: 2008-07-29 |
Word Count: 1120 |
Page Views: 4475
| Votes: 8 |
Rating: 2.75
Reverse mortgage costs are repeatedly cited as one of the main
reasons for seniors not to get a reverse mortgage loan. However,
the same folks that harp on costs as being a reason not to use
this financial resource rarely offer a less expensive option or
an alternate proposal. Don't fall into the trap of listening to
the negative hype without doing your own research. Find out what
the true costs are and whether they are justified or not. Compare
the cost of a reverse mortgage to the cost of selling your home,
downsizing or moving into assisted living. Pull back the curtain
and take a good look, then make your own determination. Don't
base your decision on an uninformed friend, relative or media
reporter.
A Recipe for Good Credit
Written by: Josh Pike |
Distributed: 2006-08-17 |
Word Count: 369 |
Page Views: 3938
| Votes: 15 |
Rating: 2.73
If your credit is not as good as you want it to be, take action
now! It's easier than you think to improve your credit.
Why You Should Buy a Home Now
Written by: Clint Wooley |
Distributed: 2007-01-09 |
Word Count: 588 |
Page Views: 3945
| Votes: 11 |
Rating: 2.73
These days there is literally too much information for first time
homebuyers to make a decision sometimes. Fear can prevent first
time home buyers from ever acting on their dream of home
ownership. When you look at facts, though, buying a home makes as
much sense now as it ever has.
How to Find Financial Freedom
Written by: Kent Jacobson a.k.a. Mr. Success |
Distributed: 2006-09-26 |
Word Count: 457 |
Page Views: 5077
| Votes: 14 |
Rating: 2.71
Many people make finding financial freedom harder than what it
actually is. In order to find financial freedom all you have to
do is follow a few simple steps.
|
|
|
|
|
|
|
Article Reprint Rights
|
This work is
licensed under a
Creative Commons
License
You are not required to show the creative commons license notice when you reprint this work.
|
|
Article Statistics
|
Word Count: 1232
Total Views: 5176
Article Rating: 2.10 of 5
Votes Cast: 10
More Articles By Author:
Articles On This Website
Last Distribution Date:
2006-12-21 12:00:00
Internal ID: #4110
|
|
|
Home