If you are behind on payments and wanted to know what options are available, many time professionals forget the simple options to homeowners. For professionals in the foreclosure business, we use terms such as deed-in-lieu, foreberance, loan mod, and other terms that homeowners may not. I have come up with a few terms and options that homeowners should have available as options for available alternatives to foreclosure.
Foreberance: A company will attempt to stall or reduce your payment by submitting a hardship package on your behalf. Many times the lender will work with a "foreclosure assistance" company before working with an individual attempting to submit a foreclosure package.
Buy-Back-Program: With this option, you can actually sell your house and continue living in. Some investors offer a buy back program where they will step-in quickly, purchase your house, and allow you to rent it while you catch up on your bills and even allow you to purchase it back from them once you are "back on your feet". (Be very carefull, some companies are better then others, and of course, you have those predators out there)
Restructure (Most Popular Alternative) - Some foreclosure companies will negotiate with your lender to get your loan in good standing again. There are many options available to get a restructure approved like a separate payment plan for your delinquency or even adding the delinquency to the end of your loan. No one can gurantee to restructure your payments, so becarefull.
Reinstatement - Pay your lender(s) all of your past due payments to bring your mortgage current. This option is rarely feasible. (However I know some private money lenders that will provide homeowners up to 90% for the reinstatement amount.)
Refinance - Hardly available, through traditional lenders, however some foreclosure companies have established relationships with inhouse lenders who can give loans on mortgages that are in foreclosure if there is enough equity in your property available.
Sell Your Home - You may simply sell your home before the Foreclosure Sale Date. Sometimes the home owner is unable to sell the home outright at the desired sale price and this is not an option.
Short Sale - In this instance the lender may take less than what you owe on the loan to avoid a lengthy and costly foreclosure process.
Deed-in-lieu of Foreclosure - You or an foreclosure company can arrange for you to simply give the home back to the lender and walk away with a clean slate.
Bankruptcy - This is a last resort. This will only save your home temporarily. If you miss one payment during this process the lender will put you right back into foreclosure.