Looking for the right mortgage for your exact financial situation can seem overwhelming at times with all the acronyms, different rates, varied terms, etc. It can feel like someone speaking a foreign language to you. The last thing in the world you want to happen is to get ripped off.
A Mortgage is a loan, which allows the consumer’s home to function as collateral. A bank or mortgage lender will loan a large amount of money, which the consumer must pay back. Typically, the amount of the loan is 80 percent of the price of the home. If the consumer fails to make payments or pay back the loan, the lender can take ownership over the home through a process known as foreclosure. During foreclosure the consumer stops making payments for varying reasons, some of which may include financial difficulties, loss of a job, medical problems or, simply having too many debts. When a consumer stops making payments to the lender the loan will become delinquent and the consumer goes into default. This status continues for 90 days after which, the lender will file for a Foreclosure notice.
There are several methods to avoid foreclosure. These methods include Mortgage loan Restructuring and Mortgage Debt Forgiveness. With Mortgage Loan Restructuring, the consumer is allowed to make lower payments after Debt Negotiations with the lender. These repayment terms are for the existing mortgage on a home and may allow the consumer to keep their home through more affordable payments. Through Mortgage Debt Forgiveness the lender forgives, all or part of the Mortgage Debt owed. This coincides with Mortgage Loan Restructuring because the lender is forgiving a set amount of a loan and accepting smaller payments. However, Mortgage Debt Forgiveness may also occur because the consumer lost their home during foreclosure.
