Foreclosure is one of the most devastating financial challenges
that a family can face and one that many times can be avoided. The options available to residents for foreclosure are many, including
but not limited to short sales. Following is a brief explanation of these solutions:
Reinstatement A reinstatement is the simplest
solution for a foreclosure, however it is often the most difficult. The homeowner simply requests the total amount owed to the mortgage
company to date and pays it. This solution does not require the lender's approval and will 'reinstate' a mortgage up to the day before
the final foreclosure sale.
Forbearance or Repayment Plan
A forbearance or repayment plan involves the homeowner negotiating with the
mortgage company to allow them to repay back payments over a period of time. The homeowner typically makes their current mortgage
payment in addition to a portion of the back payments they owe.
Mortgage Modification A mortgage modification involves the reduction
of one of the following: the interest rate on the loan, the principal balance of the loan, the term of the loan, or any combination
of these. These typically result in a lower payment to the homeowner and a more affordable mortgage.