If the bank is threatening to foreclose on your home, it’s natural to feel powerless. Depending on the circumstances, though, you may be able to take back control of the situation. An attorney can help you employ the following strategies for ending a foreclosure.  

How to Stop a Foreclosure

1. Modify the Mortgage

Applying for a loan modification will effectively halt the proceedings because lenders are prohibited from foreclosing on a property during the review process. If the modification is approved, you’ll be able to stop the foreclosure altogether.

The primary purpose of loan modification is to make the repayment plan more manageable for the borrower. Your lender may be able to do this by extending the life of the loan, thereby lowering your minimum monthly payment, or by reducing the interest rate. 

2. Sell the Property 

If you owe more than the home is worth, commencing a short sale may be the easiest way to get out from under the debt without getting a foreclosure on your credit report. Before you can sell the home for what it’s worth, though, the lender will have to agree to accept less than what you owe in exchange for erasing the debt. Banks often approve a short sale if the homeowner can prove that their income has dropped or that they’re facing a mandatory job relocation. 

3. Declare Chapter 13

Often called “reorganization bankruptcy,” chapter 13 can prevent foreclosure by helping you catch up on past-due mortgage payments. During chapter 13, debtors propose a manageable three- to five-year repayment plan to catch up on their financial obligations.

If you can incorporate your past-due balance into this plan while still making regular mortgage payments, you may be able to keep your home. A bankruptcy attorney can determine if this is the right option for you.

If you’re concerned about losing your home because you’ve fallen behind on mortgage payments, turn to Gilbert P Kaback Attorney at Law. For more than two decades, this seasoned bankruptcy lawyer has been helping clients throughout Colchester, CT, regain their financial footing. Attorney Kaback will evaluate your situation to devise the most effective strategy possible for securing a clean slate. To request a consultation with this bankruptcy attorney, reach out on his website or call (860) 537-0874.