According to RealtyTrac, the number of foreclosed homes in the United States rose 21% in 2009 to a record 2.8 million (Source: Business Week). This is a 120% increase from 2007. Michigan is no exception, ranking 8th in the country for foreclosure postings. You may be asking, how do I avoid a home foreclosure?
Although sometimes a foreclosure situation cannot be anticipated or avoided, there are steps you can take for proactive foreclosure prevention. Here are some steps you can take:
Proactively manage your budget. If you find that your debt is getting out of control, don’t wait to address it. Having a high debt-to-income ratio can create unintended consequences, such as:
Overwhelming debts can impede your ability to maintain timely mortgage payments
If your debt-to-income ratio is too high, you may not qualify for a loan modification. According to government guidelines, the loan modification process aims for a housing-related debt-to-gross-income ratio of 38% or less.
We can help you to reduce your debt-to-income ratio through a Chapter 7 debt elimination program or by debt consolidation in a Chapter 13 program.
Request a loan modification. If you are in an adjustable rate mortgage or a have a balloon payment, don’t wait until your monthly payment becomes unaffordable. Contact your mortgage company to begin the process of requesting a loan modification.
Remove a second mortgage or home equity loan. Through the Chapter 13 process we can legally remove a second mortgage or home equity loan if there is not enough value in the home to support it. This is a way to re-align your budget and bring your home’s value back in line with the current market value.
It is a difficult time for homeowners right now. We are here to help clients proactively manage their finances in order to prevent future foreclosures. If you are currently facing a foreclosure, we can help you to legally stop the sale and set up reasonable repayment terms with your lender. See the contact information below to learn more about the
By Attorney William Johnson, founder and managing partner of Acclaim Legal Services a Michigan based law firm that specializes in foreclosure prevention and bankruptcy in Southfield, Flint, Dearborn and Warren.
Acclaim Legal Services, PLLCTwo Lahser Center26200 Lahser Road, Suite 330Southfield, Michigan 480331-888-868-6005