Financial Beast

Sept. 5 (Bloomberg) — Foreclosures accelerated in the second quarter to the fastest pace in almost three decades as interest rates increased and home values fell, prompting more Americans to walk away from homes they couldn’t refinance or sell.

How to prevent foreclosure

Foreclosure don’t have to be the end of a financially successful live, there are ways to recover from a foreclosure for example repairing your credit. I strongly urge that you do as much as you can to prevent a foreclosure. A foreclosure is destructive to your credit and should be prevented at all time. Most foreclosures happen due to circumstances beyond our control like divorce, job loss, or health related issues. What are your options?

Refinance

Simply get a new mortgage or home equity loan. In many cases the current mortgage is part of the problem. In the last 5 years, many people have either obtained interest only or adjustable rate mortgages in which the payment now has increased to an unmanageable level. Take the time to shop for alternatives, mortgage rates and programs change daily.

Negotiate with the current lender

Find out how much you currently owe and what the lender will take to suspend the foreclosure process. Contrary to what you may think the lender really doesn’t want your house. Get whatever time you can to prevent long term damage to your credit rating. What ever agreement you make with the lender make sure you abide by the time frames. Get it in writing.

Sell the House

A popular expression; “What you own, will become to own you”. If you have followed the steps above and are not able to keep your house, it is better to sell it yourself then to have it repossessed by the lender. If your time is truly running out ask the lender if they will consider a “Short Sale”. A short sale is where the lender may actually permit you to accept a contract on the property for less then is actually owned on the property. You will need to speak to the lender directly, but if the only other choice is foreclosure, it is better to sell your house yourself.

For a complete update about the Foreclosure situation read this article
U.S. Mortgage Foreclosures, Delinquencies Reach Highs (Update1)