Save Your Home with Loan Modification and Forbearance Agreements

Save Your Home with Loan Modification and Forbearance Agreements

One of the most stressful things to deal with is the possibility of losing your home. Unfortunately, there are many people facing this threat.
What many people are not aware of is the fact that there are many programs available to help prevent foreclosure. Your lender will usually try to set you up with any options available. It is far less expensive for your lender to help you avoid foreclosure, than to have to take your home away.
The great news is, just because you are three months behind on your mortgage, does not mean that you will lose your most prized possession. You can still hold on to your home. However, the most important thing you can do to prevent losing your home is simply to contact your lender. They are usually willing to work out something with you, as long as they are aware that you truly want to make things right.
Here are two options available for you to utilize to help you save your home.
Loan Modification
If you are able to currently make your regular mortgage payments, but are having a difficult time catching up from the past-due amount, you can negotiate with your lender to fold any past-due amounts into the unpaid principal balance. This would include interest and escrow, and the new amount will be re-amortized over a new period of time.
If you are unable to make payments at your current rate, negotiations can be made with your lender to extend your loan balance for a longer period of time, which will make the loan amount at a more affordable level.
Forbearance Agreements
Let’s face it, temporary financial hardships can ultimately devastate your financial situation. Unfortunately, people who live paycheck to paycheck will have a very hard time “catching up”. This is especially true with house payments. Because you are not allowed to fall very far behind on a house payment, never mind the fact that you have paid faithfully for the last ten years prior to those last three months of hardship, your house is at risk.
Many lenders will offer you a Mortgage Forbearance Agreement. This means they will reduce or delay payments for a specific amount of time, and then at the end of that time, arrangements will be made to bring the account current. Many times, the lender will cease legal actions, with the understanding that you will bring your account current at a specific time. Lenders may combine your Forbearance with a Reinstatement or Repayment Plan, as long as they are comfortable you have the ability and means to pay back the amount due to bring your account current.
Another type of Forbearance is “Special Mortgage Forbearance Agreements”. This is a written plan to help you repay your missed payments to avoid foreclosure. With this type of Forbearance, you may be allowed to postpone your monthly payments for up to four months.
Although it is sometimes very easy to set up a Forbearance Agreement with your lender, your lender could make it very difficult. This is why it would be beneficial to contact a third party to help protect your needs and rights. Don’t wait until you lose your home. Talk to your lender, and learn the options available to you to help you protect your home.

New York Foreclosures

Learn How New York Foreclosures are Different than Most States
New York foreclosures are handled quite differently than most states. It is very important to know the laws of foreclosure in your own state.
How does New York Foreclosures differ from many other states?
There are judicial and non-judicial foreclosures.
In short, most states use the non-judicial approach. This means that because properties are held by a deed of trust, the foreclosure process does not include the State Courts. A foreclosure is handled at the County level by the Trustee Sales that is arranged by the lender. So, foreclosures in “trust states” take quite a bit less time than judicial foreclosures. In fact, a foreclosure in a “trust state” can take as little as 104 days from the time between a Lis Pendens (notice of mortgage default) and the Foreclosure Auction.
Properties in New York are secured through mortgages instead of deeds of trust. Foreclosures in New York are considered to be judicial foreclosures because the foreclosure proceedings must go through the courts before a property can be sold at a public auction. Because proceedings must go through the courts, it takes about 12 to 18 months after a Lis Pendens has been filed and the property hits the auction block. The reason it takes so long is because all people involved, (including mortgage holder, creditors, tenants of the owner, etc.) have to be served with papers.
Eleven Judicial Foreclosure States
• New York
• Maine
• Connecticut
• New Jersey
• Pennsylvania
• Ohio
• Indiana
• South Carolina
• Florida
• Louisiana
• North Dakota


Now that we are familiar with the differences between judicial and non-judicial foreclosure states, it is important to know the process of a judicial foreclosure. The following are steps that will be taken prior to and after a foreclosure in the state of New York.
What happens before a foreclosure process is put into action?
• The lender may send a warning of impending foreclosure to the borrower. PLEASE NOTE – although this may be done as a courtesy to you, it is NOT a requirement in New York.
• The lender files suit against the borrower for the amount in default.
• The borrower is then notified of the foreclosure proceedings and it required by law to appear in court. At this point, a lis pendens (notice of pending lawsuit) is recorded.
• If the borrower does not appear in court, the court will rule against the borrower, thus allowing the foreclosure sale.
• If the borrower appears in court, the court will consider the case before ruling. If the court rules against the borrower, the foreclosure sale will be scheduled. This will usually take 7 – 9 months.
What happens once a foreclosure has been scheduled?
• The date of sale will usually be scheduled at least 4 months after the court ruling.
• The notice of sale has to be published in the local newspaper once a week for at least 4 weeks before the sale.
• In New York, the foreclosure sales are made by public auction at the county courthouse. The highest bidder will receive the property. Anyone can bid, including the lender.
• The winning bidder will usually have to pay ten percent of the final bid at the sale, and the remaining balance is due within 30 days.
• Once the property is paid in full, the winning bidder takes ownership of the property.
• The borrower will have no rights of redemption after the sale.