HUD Tips on How to Avoid Foreclosure

Homeowners who default on their loans and are having difficulty catching up with their debts should take heed of these tips from the U.S. Department of Housing and Urban Development (HUD) on how to avoid a foreclosure pitfall.

• Your financial situation has changed due to loss of job, increase in taxes, medical expenses and other reasons which made you default on your mortgage payments and put you at risk of foreclosure. As early as possible, find ways to catch up with your mortgage payments. The bigger your arrears, the more difficult it will be for you to avoid losing your house.
• Do not hesitate to contact a mortgage lender upon realizing that you have difficulty making your monthly mortgage payment. Remember, lenders are not interested not your house. They only want a return of their investments and so will always have some options to help homeowners avoid foreclosure.
• Do not ignore mails from lenders, especially first notices because they often offer valuable information about options to prevent foreclosure.
• Be informed of your mortgage rights by reading loan documents from your lenders.
• Contact the State Government Housing Office to know about laws and timeframes that governed foreclosures on your state.
• Contact a counselor approved by the HUD to understand the law, organize your finances and learn your options. Housing counselors can also assist you in negotiating with lenders.
• Organize your finances by prioritizing expenses. Healthcare and mortgage payments are the top expenses that any homeowner should prioritize. Avoid spending on items that you think you could live without, such as cable and magazine subscriptions and health club membership.
• Find ways to earn additional cash such as selling your second car or life insurance to show a lender your willingness to go an extra mile to avoid foreclosure.
• Always remember that you can ask for foreclosure prevention information and assistance from your lender and any housing counselors approved by the HUD. So avoid dealing with companies that claim they can help you keep your house.