Understanding foreclosure, protecting a home

  • Published
  • By Capt. Judd R. Bean II
  • 374th Airlift Wing Legal Office
YOKOTA AIR BASE, Japan --  If homeowners are falling behind in their payments, they should take immediate action to avoid foreclosure.

Foreclosure is the legal process used by a lender, such as a bank, to repossess and sell a home when the homeowner falls behind on loan payments secured by the home.
Here are some suggestions for foreclosure prevention: 

First, contact the lender as soon as the problem is realized. Lenders do not want to foreclose on a house. They provide options to help borrowers facing financial problems.

Second, don't avoid the problem. Open and respond to all mail from the lender. The first notices received will offer information about foreclosure prevention. Later mail may include notice of pending legal action.

Third, get spending priorities in order. After health care, keeping a house should be a top priority. Review finances and cut spending, such as memberships and entertainment, in order to make a mortgage payment more feasible.

Fourth, use available assets. Are there any assets worth cash that can be parted with? Can anyone in the household able to work an extra job?

Fifth, know your mortgage rights. Research the foreclosure laws for each state via the Internet. Review all loan documents to learn what a lender may do.

Sixth, understand foreclosure avoidance options. Information can be found at the U.S. Department of Housing and Urban Development Web site at www.hud.gov.

Seventh, avoid using foreclosure prevention companies. Don't pay fees for foreclosure prevention help. Instead, put that money toward the mortgage. Usually people can do just as well by speaking directly to the lender.

Eighth, avoid foreclosure recovery scams!  Any company promising to stop a foreclosure immediately if someone signs a document is probably a scam. Never sign a legal document without reviewing all the terms and obtaining professional advice from an attorney, a trusted real estate professional, or HUD approved housing counselor.

Nine, remember help is out there! HUD funds free or low cost housing counseling. To find a HUD-approved housing counselor, go to www.hud.gov or schedule a legal assistance appointment with the 374th Airlift Wing Legal Office by calling 225-8069.