If you are a single parent that has fallen behind on your house payments, you are probably trying to figure out how to avoid foreclosure. If you take the right steps, you may be able to keep your home or reduce the damage to your credit rating and single parent finances if you do not keep your house.
Be sure to contact your lender immediately if you are unable to make a payment to explain your situation. They may be able to waive or lower payments for a period of time until your situation improves. Even if you do not plan to keep the house, you need to be in contact with the lender so you know when you must move out.
Keep the right mindset. Now is not the time to go into panic mode or adopt a victim mentality. As a single parent, you have had many challenges thrown at your in the past and overcame them. You can deal with this challenge, too.
Decide whether keeping your home is realistic. Were you doing fine with the payments until you lost your job? If so, what are the chances of getting a comparable job soon? If your financial situation is short-term, then you may want try to keep the house. But, if you have been continually struggling, then your focus should be to get out of the house and move to more affordable quarters.
If you have decided that you do not want to keep the house, you may be tempted to let the bank foreclose. This will damage your credit rating, and make it difficult for you to buy another house or even find a place to rent. You may want to consider listing your house on the market or looking for a private buyer if you can afford to offer the house at an attractive price that will allow you enough proceeds to pay off your mortgage after the costs of selling.
In some cases, you may be able work out a deal with your lender to give the house back to the bank. While this will also hurt your credit rating, you will avoid having a foreclosure on your credit record, and the lender may prefer this alternative to having to go through foreclosure proceedings.
If you could rent your home for enough to cover the mortgage payment, consider moving out temporarily to a free or a cheaper place and renting until you get back on your feet. Some mortgages require you to promise to live in the house, so check the terms of the mortgage before you go this route.
More tips to avoid foreclosure will be posted next week…
How To Avoid Foreclosure: The Ins and Outs of Avoiding Foreclosure and Saving Your Credit