Home foreclosure is an extremely unpleasant process that results from unpaid debts to creditors. Regardless of why you can no longer comply with a regular payment plan, lenders will try to recover their losses by taking away your property. Read below about how to cope with this challenging situation.
Anticipating ahead of time and trying to stop foreclosure in Florida is not that difficult. You can be sure that creditors will tackle your case if you delay several payments in a row. That is why, when you just find yourself in a difficult financial situation, you can take preventive measures right away:
- Mortgage modification. If your difficulties are temporary, lenders may agree to revise the payment plan according to your current capabilities.
- Short refinance. This option provides for the transfer of part of your debt into a new loan. The rest of it can be nullified by the creditors.
- Reinstatement allows you to pay in a single payment a certain amount of the total debt (including penalties and interest) before a certain date.
- Forbearance is possible if creditors consider that the reason for non-payment is valid and are ready to grant you an extension.
As you can see, such methods include direct dialogue with lenders. You should not hide your current state and try to escape responsibility. The best option would be to admit your financial insolvency and ask your creditors, for example, to reconsider your payment plan. They are ready to meet halfway and ease your conditions in many situations, just to get the money back, even if it takes a little more time.
If you missed the point of no return, accumulated too much debt, and the foreclosure is inevitable, filing for bankruptcy is your best solution. You can do it yourself, but it is better to seek help from specialists. Bankruptcy lawyers can conduct a comprehensive assessment of your situation and help you collect all the necessary documents in a short time.
As soon as you submit your application, the so-called “automatic stay” takes effect. It stops the foreclosure process in progress, preventing lenders from collecting debt from you. Of course, credit institutions can file a counter-petition with a request to lift this ban. However, all this takes quite a lot of time, which will be enough for you to study available ways out of the situation.
In legal practice, the most commonly used are Chapter 13 and Chapter 7 Bankruptcy. When choosing an option, many factors are taken into account, including the size of your secured and unsecured debts. The best way to deal with foreclosure for individuals is Chapter 13 since it allows debtors to maintain their properties and restructure existing debt.
Consult With Experts
In a difficult financial situation, the most important thing is to stay calm. If you have lost the ability to pay your mortgage regularly, consult lawyers. As a rule, many firms provide the first sessions free of charge. They will help you understand the seriousness of the situation and roughly estimate your chances of a favorable solution to the problem.