How Many Payments Can You Miss Before Foreclosure?

How Many Payments Can You Miss Before Foreclosure

When you got approved for your loan, you agreed to make monthly mortgage payments. This is based on the contract with your lender. However, sometimes, you may face unexpected circumstances that have a negative impact on your paying capacity, and you cannot make regular payments anymore. Unfortunately, if you cannot pay for your property, and you start missing payments, you may face foreclosure and lose your home.

How Many Payments Can You Miss Before Foreclosure?

In most cases, as a homeowner, you can miss up to four payments (which is 120 days) before the lender starts the foreclosure process. If you are struggling financially and cannot make payment within the next few months, it is recommended to contact your lender immediately and discuss possible solutions.

Here is what you can do in order to avoid foreclosure, even if you missed several payments.

Negotiate With Your Lender

The very first thing you need to do is to communicate with your lender and try to find a solution. If you are facing financial issues that do not allow you to make regular payments, discuss it with your lender. Be honest and talk about your problems. In most cases, lenders will be glad to offer you a financial solution because foreclosure is not beneficial for them.

Apply for Loan Modification

If you modify your mortgage, it will become easier for you to make monthly payments. Loan modification can be done by extending the term of your loan, reducing the interest rate, or lowering the amount of principal for your mortgage loan.

File for Bankruptcy

In general, filing for bankruptcy is not an easy solution. However, in many cases, it is the only one and the best solution that allows you to avoid foreclosure and keep your property. The best thing about bankruptcy is that once you submit it, the foreclosure process is frozen. The main purpose of bankruptcy is give you additional time to work out the alternatives or to negotiate the terms of a new mortgage.

Conduct a Short Sale

A short sale is a very common method that people use to avoid foreclosure. A short sale means that the property is sold for less than its current value. However, it is important to remember that in order to proceed with a short sale, you need to receive approval from your mortgage lender. The good news is that the majority of lenders approve short sales because they do not want to deal with foreclosure.

Consider a Deed in Lieu

A deed in lieu is known as a voluntary agreement between a homeowner and lender, under which the homeowner is giving the house back to the lender in exchange for the lender agreeing not to proceed with foreclosure. If you are thinking of this option, it is important to know that a deed in lieu has a negative impact on your credit. However, this impact is not as severe as the impact of foreclosure, which lasts seven years.

Contact a Foreclosure Expert or Counseling Agency

If you are struggling with mortgage payments and do not know what to do, it may be a good idea to contact a counseling agency to talk to an experienced agent. Agents will provide you with loss mitigation counseling. With the help of counseling agencies, you will learn about effective and quick ways to avoid or stop foreclosure.

Sell Your Home to a Cash Home Buyer

Many people do not know this, but one of the most effective ways to avoid foreclosure (even if you are already late on your payments) is to sell it to a cash buyer. Cash home buyers purchase all types of properties and homes for cash as is, meaning that no repairs, updates, or renovations are required. With the help of this option, you can sell your home immediately, stop foreclosure, and receive cash that you can spend immediately.

If you are looking for a cash home buyer in Stockton, CA, or any other nearby area, you should contact Frank Buys Houses. Our mission is to make the home-selling process as easy and stress-free for our clients as possible. We buy houses in any condition or location, and we can do so immediately. Therefore, if you want to sell your house fast, do not hesitate to contact us. We are always ready to help.