Avoiding foreclosure What every homeowner should know
No one buys a home hoping to get behind on payments and have the bank foreclose on it. Here are a few tips to avoid this problem altogether, and what to do if it does occur. Don’t set yourself up for failure There are two main ways to avoid foreclosure:
• Don’t put yourself in a situation where you won’t be able to afford your mortgage. Know how much you can really afford before you start shopping for a home and stick to that price range. Often, people over-extend themselves financially when in reality they don’t and won’t have the means to pay their mortgage payment. Just because the mortgage lender approves you for a loan at a certain amount doesn’t mean you can actually afford the payments on that loan.
• Understand your loan. Many people get into trouble because they don’t understand their responsibilities regarding their home loan. There are many types of loans where the payments for the first year or first few years are much lower than the amount you will pay in the following years. Talk with your lender about various loans and make sure you understand how much your payment will be at the beginning as well as what your payment might be in the future.
What to do if you think you’re heading toward foreclosure Do not be embarrassed. Instead, contact your lender as soon as you’re aware that your payment will be late. Also, never ignore your lender’s phone calls or letters. If you act uninterested in the fate of your home, your lender will be less willing to work with you in remedying the problem.
If you don’t want to speak to your lender first, you can contact a HUDapproved counseling agency that will work with you and your lender to negotiate a repayment plan. You can call 800/569-4287 for the counseling agency nearest you. Also, KeepMyTexasHome.org is a comprehensive resource for Texas homeowners who are, or who may become, behind on their mortgages. This site outlines the foreclosure process in Texas and provides bestpractice steps and other resources for Texans who may face foreclosure. On KeepMyTexasHome.org, you can search an online database of Texas REALTORS® who’ve undergone specialized training to help homeowners avoid foreclosure
@TheTexasBroker (a.k.a Allen Keith Hebert)