For many Central Florida families, it’s getting difficult to keep up with rising housing costs. Unexpected expenses, job loss, medical bills, and economic downturns can put them at risk of foreclosure. If you and your family find yourselves in danger of foreclosure, working with your lender is the first critical step in trying to avoid losing your home. HANDS of Central Florida Inc. is here to offer financial counseling for Central Florida homeowners in distress. Please reach out to us immediately for help.
In the meantime, here are some tips to guide you through working with your lender to save your home:
1. Contact Your Lender Immediately
Don’t wait for missed payments to pile up. As soon as you know you may have trouble paying your mortgage, reach out. Lenders are often willing to work with homeowners who show initiative and communicate early.
Be honest about your financial situation. Explain the cause of your hardship (job loss, medical emergency, etc.) and ask what options may be available.
2. Know Your Mortgage Details
Before contacting your lender, gather all relevant information including your loan balance, monthly payment amount, interest rate, and loan type (FHA, VA, Conventional). Also, know how many payments you’ve missed and the amount you are behind. It’s also good to know your escrow and property tax status. Having this information handy will help you and your lender assess possible solutions.
3. Ask Your Lender About Loss Mitigation Options
Most lenders offer programs to help struggling homeowners. These include:
- Forbearance which can temporarily reduce or pause your mortgage payments.
- A Loan Modification which can change the loan terms to make payments more affordable.
- A Repayment Plan which allows you to catch up on missed payments over time.
- Refinancing which may still be available if you still have good credit.
- A Deed-in-Lieu of Foreclosure which is the voluntary transfer of ownership back to the bank to avoid foreclosure.
- A Short Sale where you can sell the home for less than what you owe, with lender approval.
4. Document Communications With Your Lender
Keep detailed records of all communication with your lender including dates and times of calls, names of representatives, summaries of discussions and agreements, and copies of all correspondence.
This documentation can be crucial if there are any disputes or misunderstandings later.
5. Work With a HUD-Certified Housing Counselor
As mentioned above, you can get free or low-cost help from a HUD-approved agency like HANDS of Central Florida Inc. Our HUD-certified counselors can help you review your finances and understand your options. We can also communicate with your lender on your behalf. If you are not in the Central Florida area, you can find a housing counselor near you through the HUD website.
6. Respond Promptly to All Notices
Don’t ignore mail from your lender or the court. These documents often contain important deadlines. Missing them can result in losing your legal rights or opportunities to save your home.
7. Stay in the Home During the Process
Many foreclosure assistance options require you to still live in the property. Leaving may disqualify you from certain programs, and it can weaken your case for assistance.
8. Learn to Spot Foreclosure Scams
Be cautious of anyone who asks for upfront fees, promises to “save” your home or “guarantees” foreclosure prevention. Also avoid anyone who encourages you to stop talking to your lender. Lastly, make sure you are working with legitimate, HUD-approved resources.
Facing foreclosure is extremely stressful, but you don’t have to go through it alone. Open communication with your lender and support from local or federal assistance programs can make all the difference. And remember, HANDS of Central Florida Inc. is here to assist you through the process.