The options available to you when in pre-foreclosure depends upon your particular situation and each situation is different. As the timeline draws closer to the auction date and/or the letters sent by the bank/mortgage company and attorney's are ignored, the options available become more and more limited.

1. The Best Option: Reinstatement of Loan. Also called Cure. This option is paying the lender everything that is owed in one lump sum. This includes any missed payments, all late fees, foreclosure fees, legal and attorney fees and the principal owed during the delinquency. A cure may involve the seller curing or deeding it to the investor "subject to" the exisiting loans, who will cure. Unfortunately we find that unless a job status has changed or you can find money through a 401K, annuity, CD's or a relative, this option is not available to most folks.

2. Repayment Plan: Negotiating a written agreement between the lender and the borrower (homeowner). Typically, these plans require higher payments than the regular monthly mortgage amount for a period of time until the loan is brought up-to-date. Available to those whose income allows the higher payments.

3. Loan Modification: A loan modification involves changing one or more terms of a mortgage to meet your financial situation. The types of loan modification includes reducing the interest rate of the mortgage, change the mortgage product (from an adjustable rate mortgage to a fixed rate or interest only mortgage), extend the term of the mortgage and/or add delinquent payments to the mortgage balance. Modifications are NOT easily granted and there must be strong, justifiable reasons for the request. The loan modification process can take between 45-60 days to go through.

4. Forbearance Agreement: The lender will allow you a period of time (3-6 months typically) of either low payments or no payments at all. We usually see the lender allow a forbearance when there is temporary loss of employment or a tragedy in the family. If the lender does not extend the length of the loan, the later payments will be higher than the original monthly mortgage payments until the loan is brought current. Please understand that if the lender agrees to the forbearance, your property remains in foreclosure until the payments are made up. You would also find it very difficult to refinance if a forbearance is accepted.

5. Deed-in-Lieu: A Deed in Lieu of foreclosure is an option in which a borrower voluntarily deeds the property to the bank. The bank will not accept a Deed-in-Lieu of foreclosure if the borrower is finacially able to make payments.

6. Sale: The borrower sells the property typically through a Realtor or For Sale By Owner, pays off the loan, and if there are sufficient proceeds from the sale, the borrower escapes foreclosure.

7. Short Sale: The borrower makes an agreement with a buyer to sell the home for less than is actually owed. The Short Sale has to be approved by the lender(s) and this can time consuming (anywhere from 2 weeks to about 60 days). Short Sales remain a viable option if the borrower (homeowner) fully understands his/her legal obligation. As the credit crunch is hitting banks and mortgage companies, more and more Short Sales are being accepted. If you owe more than what your house is worth, contact us immediately to see if a Short Sale will work for you.

8. Refinance: An option available to the homeowner is to refinance the home. Free Refinance Report This option may not be available if you have poor credit or no equity in the home. Also beware of lenders or brokers that like to tack on high fees and high interest rates for such loans, causing the homeowner to make higher payments.

9. Sell To An Investor: We may be able to make up your back payments, late fees, foreclosure fees, legal and attorney fees, while taking over your current payments. You will be saved from having a foreclosure on your record.

10. Do Nothing: Your credit will be ruined for a period of 7 to 10 years. The lender will take your home and all of your equity. If there is no equity they may come after you to pay the shortage or deficiency.

More info on your stop foreclosure information search:

Get Free Foreclosure Advice and Free Refinance Quotes
Get your free on-line foreclosure refinance quote and free advice from foreclosure mitigation specialist in minutes. Compare real offers from top national subprime and hard money lenders... more...

Getting Ready To Face Foreclosure
As interest rates have risen nationwide, and the real estate market has begun to stagnate or drop, foreclosures have become a rising problem. While there are many resources available for homeowners to save their homes, there are just as many scams out there. Many of these scam companies offer to ... more...

Vermont Foreclosure Laws
Vermont is a strict foreclosure state. That means that foreclosures in this state proceed on the premise that the lender owns the home, not the borrower. So, if the borrower transgresses on any condition in the mortgage before the loan is paid in total, they will lose all right to be in the home. ... more...

Secrets to Stop Foreclosure - Part 1
Most homeowners believe that foreclosure laws are designed to hurt rather than help them. Not so. The secret is that foreclosure laws have evolved to protect the borrower--not the lender. There, I've said it. The secret is out! Now listen closely and understand why I say this. The foreclosure ... more...

How Does a "Deed in Lieu of Foreclosure" Work?
A "Deed in Lieu of Foreclosure" is when a lender accepts a deed to the homeowner's property in foreclosure instead of continuing the foreclosure process and incurring more expenses to get the deed anyway. However, this does not mean the homeowner is no longer responsible for a loan deficit if the ... more...