Few things are more devastating than losing your home. And yet, when money is tight and payments are heavy there aren’t many options open to you. However, that doesn’t mean you have to go down without a fight. Here are some things to try before throwing in the towel to your creditors.
Apply for Forbearance
Many mortgage companies are willing to work with you during a financial crisis. One way is to apply for forbearance. Forbearance means that you can pause your payments for a few months until you get back on your feet. The hope is that you will find an additional or alternative source of income during the forbearance period so that you can begin making payments once again. Keep in mind that you will have to cover the missed payments at the end of forbearance. Also, it is always best to communicate with your lender right away, before you miss any payments. This will give you your greatest shot at being able to work something out with them.
Sometimes, you can lower your monthly payments simply by refinancing your loan. If you bought your home with a high interest rate, you might be able to refinance with a lower rate. Or, maybe you purchased your home with a 15-year loan. You can significantly reduce your monthly payments by lengthening that out to a 30-year loan. Just remember, you will most likely have to pay several thousand dollars in closing fees. Also, extending the length of your payback period will mean paying more interest overall.
Sell it to a Home Buying Company and Rent it Back
If the above solutions won’t work for you, you do have one other option. You can sell your home to a home buying company for fast cash and then rent it back from them. While this means that you will no longer own your home, at least you get to stay in it. You won’t even have to move out–simply close the deal and don’t lose out on a single day in your home.
When you don’t want to lose your home but your prospects look bleak, you do have choices. Even if you can’t afford to own it, you can continue to call it home by renting it back from a home buying company. You deserve to stay in the home you love!
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