During the foreclosure process, your lender can take your home and repossess it then put it up for sale in an attempt to recover the debt that you owe them. If you’ve been notified by your lender that they plan to foreclose on your property, then you may assume that you can’t save your home. This isn’t true though. You still can negotiate with them up until it’s sold.
If you’re in pre-foreclosure and your lender is willing to work with you, then you may want to consider a mortgage modification. By doing this, you may be able to get them to agree to extend the terms of your mortgage loan, refinance your debt or reduce your interest rate. You’ll need to be able to prove that you have recently experienced a reduction in your income since taking out your original loan to be allowed to do this.
You may also qualify for a special forbearance that would allow you to either stop making mortgage payments or significantly reduce them. You’ll need to show your lender that you recently experienced a decline in your income to qualify for this. They’ll generally reduce your payments for a while then eventually require you to pay up to 1.5 times the amount that they originally were. Your monthly installment will only go back to normal once you’ve caught up your balance.
Another option you may be able to pursue is to request an interest-free loan from the Department of Housing and Urban Development (HUD). This loan essentially is an advance that is intended to help you bring your mortgage payments current. You’ll need to sign a promissory note agreeing to repay what’s due before you’ll be allowed to take this out. There will be a lien placed on your Texas home until you do.
If you and your lender aren’t readily able to reach an agreement, then you may able to pursue housing counseling administered by HUD. You may also need to consider filing for Chapter 13 bankruptcy. A foreclosure prevention attorney can advise you of what option may be best suited for your unique set of circumstances here in San Antonio.