If you foresee not being able to make your mortgage payments, then you will need to contact an attorney or your mortgage lender. Repossessions and foreclosures can look very ugly in your credit history and will follow you for a very long time. It is very important to not ignore letters or phone calls from your lender. The earlier you contact your lender with your situation, the less charges that will be assessed in the foreclosure process.
Repossession is when a house is taken back by the lender holding the mortgage since the homeowner could not make payments.
Foreclosure is the process by which a mortgaged property is taken over by the lending institution when the borrower defaults on the loan. The foreclosed property is usually then auctioned off, with the proceeds being applied to the unpaid portion of the loan.
Foreclosure may occur. Legally, the lender can repossess (take over) your home. When this happens, you must move out of your house. If your property is worth less than the total amount you owe on your mortgage loan, a deficiency judgment could be pursued. If that happens, you not only lose your home. Foreclosures, repossessions, and deficiency judgments could seriously affect your ability to be eligible for credit for many years.
Do not ignore letters or phone calls from your lender. If you foresee not being able to make your payments, then you will need to contact an attorney or your mortgage lender. It may seem more convenient to contact an attorney or lender online via email, but it is important to call and let them hear from you. You will need to voice your concern to remedy a foreclosure situation. The earlier you contact your lender with your situation, the less charges that will be assessed in the foreclosure process. Be prepared to provide them with financial information, such as your monthly income and expenses.
PLEASE NOTE: If you are in danger of losing your home, most of this information may apply to you. Not all of the foreclosure and repossession information contained here may apply to every circumstance and mortgage lender. Contact your lender, real estate attorney, or a housing counseling agency to get all the options available to you.