How to Stop Home Foreclosure

Millions of U.S. families are desperate to find a way to stop home foreclosure. A report by RealtyTrac showed that there were 861,664 foreclosures over the course of 2008. Whilst a moratoria by both Freddie Mac and Fannie Mae has helped to reduce filings in recent months, the number is still up 18% between January 2008 and January 2009.


Rising unemployment, personal debt and changing life circumstances have meant that it is becoming increasingly difficult to keep-up with mortgage repayments. Whilst the foreclosure process takes approximately 6 months in California due to the more involved legal procedure, it can take as little as 30 days in Texas. The good news is that there are foreclosure alternatives available, although there remains a need to act quickly and efficiently.

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Those who have several months to find a satisfactory resolution may wish to consider short selling a property to stop home foreclosure. Provided that the lender agrees, it is possible to sell your house on the open market for less than the value of the loans and mortgage secured on it. In return for this, any remaining debt is written-off. Lenders often prefer a short sale because they are able to recover a higher percentage of their money. It also means that they can avoid launching costly and time consuming legal proceedings against a homeowner. There are a number of companies and charitable organizations that provide help and assistance with the whole negotiation process.

Help for foreclosure has also arrived in the form of loan modifications for first and second mortgages. On the 4 March 2009, President Obama introduced a $75-billion dollar Making Home Affordable (MHA) plan to encourage lenders to modify agreements to promote affordability. The aim is to reduce monthly mortgage repayments by reducing interest rates and/or the principal. More recently, changes have been introduced so that the plan can now help those who are underwater with negative equity.

If you don't have a great deal of time left to stop home foreclosure, consider filing for bankruptcy. Help will be provided in terms of restructuring debt and promoting greater affordability. Since the bankruptcy laws were amended in 2005, it has become necessary to see a qualified debt counselor before proceeding.

Discover which is the best way to stop home foreclosure.