Foreclosure | Frequently Asked Questions
Q: If faced with foreclosure, what are my
options?
A: Talk with your lender immediately.
The lender may be able to arrange a repayment
plan or the temporary reduction or suspension
of your payment, particularly if your income
has dropped substantially or expenses have shot
up beyond your control.
You also may be able to refinance the debt or
extend the term of your mortgage loan. In almost
every case, you will likely be able to work
out some kind of deal that will avert foreclosure.
If you have mortgage insurance, the insurer
may also be interested in helping you. The company
can temporarily pay the mortgage until you get
back on your feet and are able to repay their
"loan." If your money problems are
long term, the lender may suggest that you sell
the property, which will allow you to avoid
foreclosure and protect your credit record.
As a last resort, you could consider a deed-in-lieu
of foreclosure. This is where you voluntarily
"give back" your property to the lender.
While this will not save your house, it is not
as damaging to your credit rating as a foreclosure.
Q: When do foreclosure proceedings begin?
A: Usually after the borrower has missed
three consecutive mortgage payments. The lender
will record a notice of default against the
property. And unless the debt is satisfied,
the lender will foreclose on the mortgage and
proceed to set up a trustee sale, where the
property is sold to the highest bidder.
Q: Will I be able to buy again after losing
a home to foreclosure?
A: It can happen. But a lot will depend
on your circumstances and the mortgage interest
rate you are willing to pay. Generally, most
lenders will consider your request for a home
loan two to four years after your foreclosure.
Predatory lenders will issue a home mortgage
in less time. But beware - they routinely charge
high mortgage interest rates, fees, and penalties
for this privilege. A quality lender will expect
you to show that you have cleaned up your credit.
Providing a reasonable explanation about the
circumstances that led to the foreclosure -
such as exorbitant medical expenses - is also
helpful.
Q: How can I protect my home from creditors?
A: Check with your state. It may provide
special protection through the filing of a homestead
exemption, which exempts some or all of the
value of your equity in the homestead - or home
that you live in and the land on which it sits
- from claims of unsecured creditors. Whether
to file a homestead exemption will depend on
your situation. Contact your county recorder's
office for details.
Are you at risk?
Many times homeowners do not know they are at
risk for going into delinquency and/or foreclosure.
Take this brief questionnaire to asses your
risk.
Can you answer "Yes" to any of these?
Yes |
No |
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Are you currently shopping for a mortgage and are interested in learning more about loan products that are available? | |
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Do you pay your property taxes separately from your mortgage payment? | |
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Does your mortgage have a prepayment penalty? | |
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Do you have an adjustable rate mortgage (ARM)? | |
| Has there been a change in household income? | ||
| Has there been a recent increase in the amount of debt you have? |
This information provided by the US government on HUD.gov - content current as of September 30, 2008.
DISCLAIMER: This information is intended for general informational purposes only and are displayed solely as a service to consumers. No information on this page or web site is to be viewed as legal advice or as an official description of judicial process. Consumers are advised to seek professional legal counsel in any default proceeding.Michigan Foreclosure Source is powered by Century 21 Today. Our agents understand the short sale process and Foreclosures. Please contact us for all of your real estate needs. We've been serving Southeast Michigan families since 1977 and it will be our pleasure to serve you and your family.