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by: IreneParkdale
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e fastest way to avoid foreclosure is to pay off the debt and penalties. Of course, if this were something you could do you probably wouldn't be in this situation. If you are like most homeowners who are facing foreclosure, you are probably confused about your options. There are several methods you can use to stop foreclosure on your home in a hurry, but each remedy has unique benefits and drawbacks. Read on to discover the most common ways homeowners can stop foreclosure fast.

Loan Payoff / Refinance

A refinance to avoid foreclosure is only appropriate in some cases. If you have ample equity in your home and a sturdy income, you may be a good candidate for a refinance payoff. This is when a bank finances a new loan, supplying the funds to pay off the original mortgage plus any fees and penalties. By paying off the mortgage, you prevent foreclosure. If you have an ARM mortgage that has recently ballooned, you may be the perfect candidate for a refinance loan as well.

Filing For Bankruptcy

Bankruptcy is considered a last resort option because it comes with quite a few drawbacks. Declaring bankruptcy to prevent foreclosure will only work for a short time. All it really does is to delay it until the bankruptcy court says the bank can go proceed. Bankruptcy should not be the answer if the foreclosure is your only major financial problem.

Using Short Sales

In a short sale, you sell the home for less than what you owe of the mortgage debt and the lender consideres this full payment. Short sales are used in some cases where the real estate market means that it is unlikely that the home will sell for full price. To know if this is a choice you have, you can attempt to negotiate with your bank to see if they will permit it.

The Deed in Lieu of Foreclosure Option

You can offer the bank something called a "Deed in Lieu of Foreclosure" on the property. This is giving back the home to the lender to avoid the process of foreclosure. By giving back the property, you can attempt to avoid the stress of the actual foreclosure and the further damage to your credit. This can be a good option if you decide that you can not afford the house and have no time left to pursue other options.

While these tips may stop foreclosure, preventing it from happening at all is a better option. By acting quickly at the first signs of possible problems, you can stop foreclosure. When you are facing foreclosure, the more time you have, the more choices are possible and the better the outcome.

About the Author

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