A 21st Century Epidemic
According to a June 6 report by the Associated Press, the national foreclosure rate in the United States hit an all time high in the first quarter of 2008. Between January and March of this year, approximately 447,723 home loans fell into foreclosure. Unfortunately, it seems that this disheartening figure will only continue to rise. As the cost of living continues to skyrocket, more and more homeowners are finding it difficult to produce their monthly mortgage payments. The national delinquency rate on home loans rose from 5.82 percent to 6.35 percent in the first three months of this year. The fear of foreclosure is all too real for many Americans. What can you as a homeowner do to avoid foreclosure? What can you as someone already facing foreclosure do to protect your hard-earned equity and keep your home?
Foreclosure: What Is It?
Generally, foreclosure is a legal process in which a lender (bank or Mortgage Company) seeks to sell or repossess a piece of property that they have helped a borrower purchase; usually because the borrower has fallen behind on their payments or defaulted on the loan. The lender uses the money from the sale of the property to pay off what was owed to them along with any legal costs. Most every agreement between a lender and borrower (a "mortgage" or "deed of trust") contains provisions for foreclosure.
Types of Foreclosure
After Falling Behind
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