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Stop Alabama home foreclosures: steps you can take

If financial hardship has caused you to fall behind on your mortgage payment, you may be able to stop an Alabama home foreclosure with one of these options.

stop Alabama home foreclosureIf you are in a financial hardship that has caused you to fall behind on your mortgage payment, you may be able to stop an Alabama home foreclosure before it damages your credit. There are a few viable alternatives to foreclosure that you should know about.

Your first step in the Alabama home foreclosure stoppage efforts is talking to your lender. Work with your lender to see if any of these options will work in your particular situation:

Mortgage modification: If you qualify, your lender can modify the terms of your mortgage to make it more affordable for you. You may even qualify for a modification through the federal Making Home Affordable (MHA) program. With mortgage modification, your payments will be reduced to an amount you can handle.

Pre-foreclosure sale: If you cannot afford your mortgage even with a modification, you may decide to sell your home in pre-foreclosure. A pre-foreclosure sale will help to protect your credit rating so that you can buy a new home in the future when you are able to afford the payments. A short sale is a type of pre-foreclosure sale in which your lender accepts less than you owe on your your home because your real estate value has dropped significantly. While it is still damaging to your credit, it is not as damaging as a foreclosure in most instances.

Has your home value dropped? Research your property value here.

Deed in Lieu (DIL) of foreclosure: A deed-in-lieu of foreclosure is another option to consider. This type of transaction involves you transferring the deed to your lender in lieu of it repossessing your home. Some banks will offer you financial assistance to relocate if you surrender the home via a deed-in-lieu transaction or may offer to pay off home equity credit lines in order to help the process along. This type of transaction will damage your credit but usually not as much as a foreclosure will. MHA has a DIL option in which they help you and the lender negotiate a DIL.

As you can see, there are a few options to stop Alabama home foreclosure proceedings. Reply! is a great source for finding a realtor in your area who can assist you in determining if a short sale or pre-foreclosure sale will benefit you in your particular situation.

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