Foreclosure Alternatives: Which Option Works Best For You?
Foreclosure alternatives were developed by both lending institutions and the government to offset losses incurred by banks during the foreclosure process. The Mortgage Bankers Association reports losses in excess of $50,000 to banks on each foreclosed home, making the foreclosure alternatives listed in this section highly sensible for them to consider.
A foreclosure alternative must be initiated by the homeowner who needs assistance. Foreclosure is a separate process altogether. In other words, if you’re late on your mortgage payments and your bank has already initiated the foreclosure process, but you notify them that you’d like to do a short sale, the short sale will be processed independently of the foreclosure procedure. Foreclosure alternatives only prevent foreclosure when they are initiated early in the process, when the bank decides to remove a foreclosure sale date, or when the alternative is approved and completed.
Hope For The Best and Prepare For The Worst
No foreclosure alternative is guaranteed. However, as long as homeowners are proactive, their chances of preventing foreclosure and taking control of their financial future drastically increases.