If you’re an American homeowner affected by recent eviction and foreclosure moratorium suspensions, you’re not alone; compared to 2020, foreclosure rates are up 76 percent this year. In October alone, foreclosure activity saw a 5 percent increase from the previous month.
With federal assistance expiring across the country, homeowners who relied on pandemic hardship relief are now reckoning with up to 16 months of collected mortgage payments, and many are wondering what options exist for debtors that still need help with foreclosure. While forbearance is a temporary solution, it merely serves as a band-aid treatment for the larger issue with the potential to fall even further behind on mortgage payments.
Luckily, there are still a few solutions for homeowners that need help with foreclosure, and you don’t have to rely on COVID hardship to qualify for these forms of relief. Whether you’re a year behind on payments or just entering forbearance, foreclosure isn’t the only way out of financial hardship.
Receive Help with Foreclosure Using One of These Options
Option 1: Modify Your Home Loan
Depending on your degree of financial hardship, your existing lender may approve a loan modification. With a loan modification, your current lender can grant direct changes to your original mortgage terms without switching financial institutions.
Typically, loan modifications are reserved for lenders who have already fallen behind on their mortgage payments. If you’re a homeowner who is looking to switch lending institutions, learn more about how refinancing is a better option for you instead.
If you’re a homeowner facing significant financial hardship, loan modification approval odds are much higher. Refinancing a home loan is easier than applying for a loan modification, and modification applicants must provide evidence of financial hardship to qualify for this kind of help with foreclosure.
Pros of Loan Modification:
- Good option for homeowners already behind on payments
- Keep your home
- Remain with current lending institution
Cons of Loan Modification:
- Can affect your credit score
- Difficult to qualify without evidence of hardship
- Foreclosure continues with or without approval
Learn more: Loan Modification Vs. Refinance – Which Is Best For You?
Option 2: Refinance Your Loan
Record-low interest rates are finally rising for the first time this year, and that means now is a great opportunity for homeowners facing foreclosure to consider refinancing their home loans.
Even when the difference in interest rates seems minuscule, the potential savings can quickly add up to thousands of dollars depending on the size of your home loan.
Refinancing has its downsides too, especially for homeowners seeking a quick solution to their foreclosure problems. The refinancing process can take anywhere from 30 to 60 days, with the underwriting process potentially taking as long as 2 weeks to complete. Depending on your place in the foreclosure process, you may not have the luxury of waiting 2 months for lender approval on your loan. In that case, you’ll need another solution.
Even without time constraints, refinancing your home loan doesn’t guarantee that you’ll avoid payment issues in the future. For some homeowners, the idea of getting out from under their home loan alone altogether is more appealing, and there is a way to do so…
Pros of Refinancing Your Loan:
- Take advantage of lower interest rates
- Easier qualification process compared to a loan modification
- Switch lending institutions if desired
Cons of Refinancing Your Loan:
- Approval length varies
- Can increase the cost of your loan
- Savings don’t always justify time spent
Read: How Long It Takes to Refinance a Home
Option 3: Sell Your Home for Cash
Once you’re 12 to 16 months behind on your mortgage payment, selling your home may seem like a distant option. However, selling your home during foreclosure is entirely possible, and it doesn’t have to take months either. There’s an easier way to sell your home during foreclosure, and that’s with a cash offer from direct buyers like Texas Home Buyers Group.
When you sell your home during foreclosure, you can earn back money to put toward existing debt or your next move. Rather than lose your home with thousands owed in back payments, sell your home for cash and receive money that can help with foreclosure now.
The good news for struggling homeowners? A cash home sale doesn’t take weeks or months like a traditional sale; the entire process can be completed in just 7 days. From accepting your cash offer to closing, we work on your schedule, and you walk away with an all-cash payment.
Once you’re no longer burdened by back payments, you can decide your next steps based on the financial decision that’s right for you. If you’re still early in the foreclosure process, even better! You’ll have more money to put toward your next home or rental.
You can walk away from your home sale confidently with a cash payment from Texas Home Buyers Group. Don’t let the uncertainty of foreclosure cloud the next year or more of your life—sell your home and get out from under your home loan now!
Avoid Foreclosure and Sell Your Home to Texas Home Buyers Group
No matter which path you choose to help with foreclosure, there are more solutions than you think.
If you want to stop struggling with your home loan, sell your home for cash to Texas Home Buyers Group. We can close in as little as 1 week, and you’ll walk away with an all-cash payment to put toward your next purchase.