The recession has taken its toll on many people, unemployment is at a steady average of 10% and over a million people are out of work. When there is no income or little income people have to make difficult decisions, decisions about what to pay and when. Perhaps the person has high medical expenses such as medical prescriptions, high credit card bills, high utilities, and the high cost of living.Many people have chosen not to pay their mortgages because more than likely, it is the highest bill within their budget. Not making a payment here and there does not sound harmless but in reality it can affect your credit score and ability to borrow money in the future. It can also affect the way you get another loan and if your home is foreclosed, you might not be able to get another loan.If you do get behind in your mortgage the worst thing to do is to ignore the phone calls and notices that come in the mail. Ignoring them will only make it worse when you come home and find a foreclosure notice on your door. Ignoring the problem is never a solution and it only makes it worse as the homeowner falls further and further behind.The first step is to contact the lender; the lender will prove to be your best friend as they can provide options on what can be done to stop a foreclosure. The lenders goal is to get the borrower up to date on their payments and to find a way for that to happen. There are several ways and options a borrower has to alleviate or often eliminate the problem. Ask the lender for a lower interest rate, this will reduce the payments. Also ask the lender for a lower principal and extending the loan, which will also reduce the payments. Ask the lender for a refinancing option that allows you to refinance what you owe providing the home is worth more in equity than the loan. In other words, your home must be worth more than the loan is currently worth. A final option is to sell the home to a relative or family member, then the borrower pays off the family member versus a lender, this could save on both interest, penalties and principal as without the lender none of those fees would be part of the payment. Selling to a family member might be a good option because you no longer owe the bank but you avoided foreclosures at the same time.Another source is the internet, the internet has literally thousands of lenders and debt counselors to help a homeowner facing foreclosure, and one such site to check out is the 1st Foreclosure Prevention. They have options that may help a borrower make a sound and positive decision. The website can be found at www.1stforeclosureprevention.comThey offer services that can help a homeowner get back on track with their payments and offer many options to accommodate any situation.Source: Free Articles from ArticlesFactory.com
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