What options do I have to avoid foreclosure?

If you are facing foreclosure in California, there are a few options you can try to avoid it. One option is to apply for a loan modification. A loan modification is an adjustment to your existing loan terms which can lower your monthly payments. This can be done by extending the loan’s term, reducing the interest rate, changing the loan’s type, or adding past due balances to the loan’s principal balance. You should contact your lender to see if they are able to modify your loan terms. Another option is to enter into a repayment plan with your lender. A repayment plan is an agreement between you and your lender that allows you to make up missed payments over a period of time. If your lender agrees to a repayment plan, you must adhere to its terms for it to be successful. A third option is to negotiate a deed-in-lieu of foreclosure with your lender. This is an agreement in which you voluntarily transfer the deed of your home back to the lender in exchange for the institution forgiving your debt. Often, the lender will still require you to make payments on the outstanding loan balance before they agree to the terms of the deed-in-lieu of foreclosure. Finally, you could sell your home through a short sale. With a short sale, you can arrange to sell your home for an amount less than what you owe on the mortgage. Your lender must agree to the short sale before it can go through. No matter what option you choose to try and avoid foreclosure, you should seek legal advice. A lawyer can help you understand the options available in your particular situation.

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What options do I have to avoid foreclosure?

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