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Posts Tagged ‘stop home foreclosure’

You may have made a plan to stop home foreclosure with a loan modification or short sale.
But if you have recently lost your home to foreclosure, you may wonder how best to become a homeowner again.
Deed in lieu of foreclosure, short sale and foreclosure will have different implications for your savings account and credit score–foreclosure affecting your score the worst.

Your credit score and ability to save for a down payment are two factors which will affect how soon you will be able to purchase property.

A mid-score of 620 is the minimum score required to qualify for a government loan.
Your credit report will give you your credit score as well as display the items which are negatively affecting your score.
You should check the report for accuracy and dispute any outdated or inaccurate items with your credit agency.
Often you can settle debts with your credit agency for less than you owe.

In addition to fixing your credit score, you should begin saving for a down payment as soon as possible.
With government insured loans, it has been the standard to require 3% of the purchase price as the down payment.
However, FHA loans now require that a buyer puts down 5% of the purchase price, so buyers will need to save even more.

If you have recently lost your house, it is important that you raise your credit score and save for a down payment simultaneously.
One way to do so is to open a secured positive trade line to show lenders you are responsible with your money and debts.

Knowing what you need to do now will help you qualify for a loan faster.
With attention to your credit score and savings for a down payment, you can be a homeowner sooner.

(September 2, 2009)

When my wife and I requested a temporary forbearance from our mortgage back in July, GMAC suggested that we apply for President Obama’s loan modification program to stop home foreclosure.

Although we have never had trouble paying our mortgage in the past, extreme financial hardships made it temporarily difficult for us to make the payments for July and August.
We did not originally request a loan modification because we knew we would be able to resume paying the mortgage once our temporary cash flow problem had been resolved.

However, we submitted the required financial documents to GMAC to apply for loan modification.
Today we received a letter from GMAC which stated that they were unable to approve our request for loan modification because of insufficient income.
The letter also recommended that we consider selling our property.

Aside from the temporary financial hardship that my wife and I have been experiencing this summer, we have been and still are capable of paying our mortgage.
Instead of asking for a temporary forbearance, I could have borrowed a small amount of money to get me through the summer.
Before this all started, my wife and I had never missed a payment.

Now we are two months behind on our mortgage, and we have been turned down for a loan modification.
We could actually lose our home to foreclosure, if we don’t pay GMAC $8317.87.