Here are the most common options you have when facing foreclosure:

Option 1: Reinstatement.
This is a lump sum payment that includes all arrearages associated with your mortgage such as missed payments, late fees and attorney fees, etc. that if paid in full would bring your account with your lender current. We can assist you in determining the exact amount required to reinstate your loan should you consider that to be your best option.

Option 2: Forbearance.
This option is available only through the lender. In this process a payment plan is implemented to make up all of the arrearages referred to in Option 1. The arrearages are spread out equally over a set period of time, usually 6-12 months, and will be due in addition to your current monthly mortgage payment. As a result your new monthly payment will be considerably higher. In addition, it is typical for the lender to require a lump sum upfront to get the plan started and you will have to supply proof that you have the income to make the payments.

Fact: Over 80% of homeowners agreeing to a forbearance agreement are unable to make the first payment.

Option 3: Loan Modification or Partial Claim.
This option, like the Forbearance, is only available through the lender. This process actually involves the restructuring of your loan and some cases a brand new loan. The facets of your loan that can be affected are the amortization schedule, the interest rate and the type of loan. The arrearages you have with the lender will be rolled into you loan, in essence bringing you current, and you will then begin making payments as usual. Lenders will typically require that a lump sum be paid up front to get the plan started and the implementation of a Forbearance plan for 3-6 months until the Loan Modifications can be set up and put into place. The actual criteria and options available vary lender to lender and on a case by case basis.

Option 4: Refinance.
This is one of the most popular options considered by homeowners to stop the foreclosure. The biggest drawback to this option is that the borrower’s credit may be too severely damaged to get approved and/or the house will not appraise for the amount needed to pay off the arrearages. Should you be able to qualify for the refinance of your loan it is important to keep in mind that it will very likely result in a higher interest rate, and as a result, a higher monthly payment.

Option 5: Listing with a Realtor.
Listing the property with a realtor using the normal sales process is appropriate if you have enough time to get it sold before the lender executes the foreclosure and you have enough equity to cover all of the normal costs that will be associated with the sale of the property. If you have little equity, you may be required to come to closing with money out of pocket to pay the Real Estate agent’s commission and closing costs. And trying to sell your home on your own is rarely prudent when time is of the essence. The point here is even though selling your home may involve the use of a licensed realtor it will also likely require the use of methods most realtors are not effectively trained to implement or execute.

Option 6: Deed In Lieu.
Although this is often offered as an alternative by the lender, it actually speeds up the Foreclosure process. In a Deed in Lieu, the homeowner voluntarily surrenders ownership of their property to their lender and is referred to as a "Voluntary Foreclosure."
Deed In Lieu benefits the lender by saving them the cost associated with the full Foreclosure process and allows them to gain control of the property much quicker. For the homeowner, a Deed In Lieu will impact your credit to the same extent as a if the whole Foreclosure process had been allowed to take place.

Option 7: Bankruptcy.
Filing Bankruptcy only postpones the Foreclosure process, it does not stop it. If you file Chapter 13, you must agree to re-pay all of your debts including your mortgage. As in Forbearance plans, Chapter 13 repayment plans are always higher than your current house payment.

If you file Chapter 7, your house becomes property of the Bankruptcy Trustee. If you have equity, the trustee can require the sale of your home to satisfy your creditors. If you don’t have equity the court will allow the lender remove the house from the bankruptcy and proceed with the Foreclosure. Should you already be in bankruptcy CORE 1 can still assist you in the sale of your home and will work with your attorneys to do so.

Option 8: Investors who "rescue" your home from foreclosure and offer several options for you to buy your house back while still being allowed to live in the home.
Be careful of those offering to bring your mortgage current, payoff all back fees to save your home from foreclosure and then allow you to rent from them until you can buy it back at some point in the future. Can this be done? Yes, but the terms of the deal are often a lot less attractive than the way it was originally explained.

In the contract you sign, somewhere in the fine print, it will lay out terms that make it virtually impossible to buy back your home. In many cases the criteria will leave you being required to vacate the premises and not even have the option to rent the home. It's important to keep in mind that the primary goal for most investors is to own your home. Everything else that is offered is geared to assist them in attaining their primary goal.    

With that in mind CORE 1 has elected to separate ourselves by becoming members of the National Association of Foreclosure Prevention Professionals (NAFPP) which has a published set of criteria that we agree to abide by when working with our clients. We did this for peace of mind and protection of our clients.

Option 9: CORE1, Foreclosure Prevention Professionals
There are many solutions that we can provide, but first we need to find out what your specific goals are and get some information about your home. For instance, when is the scheduled auction date and what you are currently doing about the situation?

We can give you a Free Confidential Foreclosure Prevention Consultation to customize the best solution. Click here or call us at 816-560-8494.

We look forward to helping you in your situation.