There are essentially three ways which someone can stave off the loss of their home and all of their valuable equity due to foreclosure.
1. Mortgage Refinancing
However, this option for some maybe not be viable if their home has a relatively new loan possibly without sufficient equity to satisfy the lender's necessary (LVT) loan-to-value requirement. In fact most lenders would like all loans on your home to be no more than 65% of its value. Obviously the lower the figure the better your chances are you'll be approved for a new loan, providing your credit and income is sufficient.
2. Short Sale
A Short Sale basically means that your lender agrees to discount your mortgage balance so that your home can be sold which normally takes place relatively quickly once the bank's loss mitigation department approves the short sale. In other words, the home is being sold "short" of its original foreclosured loan balance. And therefore because your home will be purchased by either an investor or an owner-occupant your foreclosure is adverted and therefore your credit is saved.
However, this option doesn't always work for a number of reasons. If you have already received notice of your property's auction date or if the lender's loss mitigation department is unwilling to work with you or your representative then unfortunately you maybe up against the worse case scenario. Save Your Credit Now
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