When temporary financial difficulties have caused you to fall behind on mortgage payments, there are options you can consider besides bankruptcy – options that can stop loan foreclosure and let you keep your house. Several types of loan restructuring can accomplish this.

Recapitalization Agreement

For a homeowner behind on mortgage payments, negotiating a recapitalization agreement can stop loan foreclosure. It is an agreement negotiated with the lender by which any past due amounts (missed payments, interest, fees) are added to the principle balance of the mortgage loan. It’s like taking a very small second loan and adding it to the first, resulting in a higher total balance.

A recapitalization agreement requires that we demonstrate to the lender that you were temporarily unable to make payments, but that the problem has been resolved. By restoring the status of your loan to current, a successful loan recapitalization agreement will allow you to stop loan foreclosure, keep your home, continue making payments, and allow the lender to avoid the time and expense of foreclosure.

Mortgage Pay Rate Reduction

This type of loan modification is negotiated to stop loan foreclosure by demonstrating that you cannot afford the current monthly payments, but could make regular payments of a slightly lower amount. Here the lender agrees to extend the life of the loan and reduce your monthly payments.

This requires that we demonstrate to the lender that you have sufficient income to afford the lower rates. This might include proof of a new job, or a residential lease showing that you are now renting out a room or other portion of the property. Often keeping a loan of a slightly longer term is preferable to the lender when compared to the time consuming and expensive foreclosure process.

Early Mortgage Payoff Refinancing – NEW PROGRAM!

This is an extremely effective method of convincing your current lender to accept a payoff for less than what you owe them. This option is available before your loan triggers the higher interest payment and before you fall behind in mortgage payments. Learn more…

At the Nader Law Firm, we are at the forefront of any new development created by lenders or Government in helping homeowners to keep their homes.

As with all legal options, you should seek qualified legal advice to stop loan foreclosure. When temporary financial difficulties are causing problems in your life, contact our bankruptcy attorney for a free consultation to explore options that can get you back on track.

NOTE: Your individual circumstances may or may not permit you to keep your house. Contact the Nader Law Firm to explore ways to stop house foreclosure but retain your credit, or options to pursue lender litigation (foreclosure litigation).