When you miss a payment on your credit card, you can expect to pay an extra fee on your next payment. If you miss a mortgage payment, catching up is not always that easy. In addition to assessing late fees, many mortgage lenders expect you to pay the full amount of missed payments before they will accept any further payments. Even if this is not your lender’s policy, it can still be difficult to catch up on a debt the size of a mortgage payment.
It does not take many missed payments before a lender may decide to foreclose on a homeowner. It can be frightening to know you are in default and even more upsetting to receive notice that your lender intends to foreclose on you. However, before you reach that point, you may have options for saving your home.
Can I save my home?
Foreclosure means the lender takes possession of the house and auctions it off to recoup the money it loaned you to buy the property. This is not the best option for the bank since it is expensive, time-consuming and rarely obtains the full amount of the loan. This is good news for you because it often means the lender is willing to work with you. Additionally, the foreclosure process is typically slow, so you have time to seek professional help and explore all your potential options, including:
- Requesting a forbearance, which is a period of grace during which you can work out a plan to repay the delinquent amount
- Adding small portions of the delinquent amount to future payments to spread out the amount overdue
- Adding the delinquent amount to the balance of your debt and refinancing your loan
- Modifying the terms of your loan to freeze the interest at a lower rate, if you have an adjustable loan
- Creating a separate loan for the overdue amount
- Seeking forgiveness of the delinquent amount, which is rare and only a viable options for those who have missed only one or two payments
Of course, if you are already in the foreclosure process, many of these options may be unavailable to you. In such cases, it may not be possible to remain in your home, but you might still avoid foreclosure. You may consider selling your home, renting it from the lender, returning the deed to the mortgage holder in exchange for cancelling the mortgage or filing for bankruptcy. Financial experts often recommend discussing your options with a skilled attorney who can offer guidance in accordance with Florida foreclosure laws.