In order to start the foreclosure process, your lender filed a Notice of Default. Once this notice is filed, you will receive a document from your lender asking you to pay the amount you owe in missed payments including the fees associated with foreclosure in the outlined time frame. When you pay the amount owed, your mortgage will be reinstated and you will continue to make payments as usual.

If you cannot pay this amount, the first step in stopping the foreclosure process is to talk to your lender. You may find it hard to pick up the phone because you fear the outcome or are embarrassed, but this step is essential in stopping a foreclosure. The fact of the matter is that lenders do not want to foreclose on your property. Many times, lenders tend to lose money when they foreclose and would rather work out a deal with you, allowing you to keep your property. If the lender agrees to modify your loan, often times they will either lower your interest rate or lower your monthly payment to fit your budget. Some lenders will require a trial period before modifying your loan permanently. During this trial period, you must make every payment on time in order to maintain possession of your property.

So what if your lender will not work with you on modifying your loan? It is important that you don’t panic. Understand that there are a few more options available to you. The first thing to try is to sell your property. If you can manage to find a buyer willing to pay what you owe on the property, you can walk away relatively unscathed.

If you owe more than your home is worth, your best bet may be to consider a short sale. In a short sale, the potential makes an offer that the lender must accept in order for the transaction to go through. A short sale will negatively impact your credit rating, but the impact will not be as great as that of a foreclosure.

If all else fails, you may want to pursue a Deed in Lieu. Signing this document gives the lender full ownership of your property. This relieves you of any fulfilling any further obligations associated with the mortgage. This option should be thought of as a last resort and is not available in all cases. You should know that doing a good research is always going to give you a variety of possibilities.