10 Tips For Homeowners Who Are Facing Foreclosure

By Chaplain Paul Slater

Foreclosures are increasing throughout the country as the mortgage industry is readjusting to the financial realities of today’s real estate market. But how can a foreclosure be a ministry opportunity?

Having gone through a foreclosure a few years ago, I can tell you from personal painful experience that my wife and I felt very alone throughout the entire foreclosure process. I believe that a church can do far more in ministering to those going through the painful and shameful foreclosure experience.

Recently I came across a government document produced by the Department of Housing and Urban Development (HUD) entitled “10 Tips For Homeowners Who Are Facing Foreclosure”.

But I will say that even if all of these tips were staring us in the face, emotionally those facing foreclosure feel so beat down that they often miss helpful advice and timely suggestions.

These foreclosure guidelines are written to assist homeowners who are struggling to pay their mortgage and could be threatened with foreclosure. This is where foreclosures become ministry opportunities for churches.

Besides helping homeowners avoid foreclosure by sharing information like this article, the inner pain of those struggling financially means they need to be reminded of God’s love. So what does HUD suggest those facing the threat of foreclosure do?

1. Those Wanting To Avoid Foreclosure Should Not Ignore The Problem. The simple truth is that the further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house to foreclosure.

2. Contact Your Lender As Soon As You Realize That You Have A Financial Problem That Could Possibly Lead To Foreclosure. Lenders do not want your house. They have options to help borrowers through difficult financial times.

3. Remember To Open And Respond To All Mail From Your Lender. Emotionally you may be so beat down by your deteriorating financial circumstances that you just give up. You may tend to deny the seriousness of the situation. The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notice of pending legal action. Your failure to open the mail will not be an excuse in foreclosure court.

4. Avoiding Foreclosure Means You Need To Know Your Mortgage Rights. Most of us do not realize we have specific rights as homeowners. HUD suggests you find your loan documents and read them so you know what your lender may do if you can’t make your payments. Learn about the foreclosure laws and timeframes in your state (as every state is different) by contacting the State Government Housing Office.

5. Understand Foreclosure Prevention Options. Valuable information about foreclosure prevention (also called loss mitigation) options can be found on the internet at www.fha.gov.

6. To Avoid Foreclosure It Is Suggested That You Contact A Non-Profit Housing Counselor. I had no idea that HUD funds free or very low cost housing counseling nationwide. I learned later that housing counselors were available to help me understand foreclosure law and my options in facing foreclosure.

7. HUD Recommends That You Prioritize Your Spending When Facing Foreclosure. After health care, keeping your house should be your first priority. They suggest you review your finances and see where you can cut spending in order to make your mortgage payment.

8. Explore Using Other Assets To Help You Temporarily Cover Your Mortgage Payment. Perhaps you have assets that you could sell for cash to help reinstate your home loan. Look into getting an extra job to bring in additional income.

9. HUD Warns Those Facing Foreclosure To Avoid Foreclosure Prevention Companies. People are very vulnerable at this time of financial struggle and unfortunately many for-profit companies may contact you promising to negotiate a loan work out with your lender. While these may be legitimate businesses, they will charge you a hefty fee (often two or three month’s mortgage payment) for information and services your lender or a HUD approved housing counselor will provide for free.

10. HUD Makes This Appeal Because Of Foreclosure Vultures: “Don’t Lose Your House To Foreclosure Recovery Scams.” The truth is there are unethical people who take advantage of those in financial distress. If any firm claims they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf.

If there are those in your world who are facing foreclosure, think of it as an opportunity to minsiter to them as they face a time of significant loss.