With the current state of the American economy, foreclosures are at an all time high. Millions of American families are suddenly facing a housing crisis that may end in the loss of their family home. So how you handle such a frightening and stressful situation? Here are some tips to assist you in stopping the foreclosure process on your dream home and getting your payments back on track.

• Assess your current financial situation: Add up your total debt and figure out exactly where you stand financially. Can you afford to catch up your payments? Are you in so deep that you cannot afford to catch up? Are there cuts you can make in your budget to divert more funds towards your mortgage payment? Are you in a position, credit-wise, to refinance into a lower rate? There are options for struggling homeowners. However, taking advantage of those options starts with assessing where you are right now. If you see places in your personal budget where you can make some cuts, do so immediately. If you are having trouble with the process, sit down with a financial advisor to help you put together a sound financial plan to save your home.

• Talk to your lender or bank: Many homeowners panic at the thought of foreclosure. Therefore, they simply shut down. They stop opening mail from their lenders and avoid phone calls regarding missed payments. This is exactly the opposite of what you should do if you are facing foreclosure. Particularly when the market is fluctuating as wildly as it has been for the last several years, lenders are more willing to work with homeowners than ever before. But you have to start by talking to them. The more you communicate with your lender, the more likely they are to work with you on catching up your payments. Let them know exactly what is going on and why you fell behind. Ask them about any programs they have for homeowners who are behind to the point of foreclosure. You may find that your lender can suggest something you had not already thought of. Nevertheless, whatever you do, do not ignore their communication.

• Refinance, if possible: A large margin of the homeowner population facing foreclosure are those with ARMs, or adjustable rate mortgages. In most instances, these homeowners started with a loan at a low rate, in some instances as low as three or four percent. However, after a year or two, the rate ballooned to as high as 12 or 13 percent in some instances, leaving struggling homeowners with an increase of up to $1,000 in their mortgage payment. If possible, talk to your lender about refinancing to a lower, fixed rate. This is the best way to stop foreclosure as it not only allows you an opportunity to work with your lender, but also allows you to refrain from making such a high monthly payment. 

• Stick with the plan: Whatever plan you and your lender agree to, make sure you stick with it. This is important because should you run into trouble down the road, your lender will be much more willing to work with you on catching up if they see you are genuinely making an effort to pay on time.

The above-mentioned plans are geared towards assisting homeowners in avoiding foreclosure. The key to making sure these tips work for you is communication. The more you communicate with your bank or lender, the more likely it is that they will be willing to work with you to keep you and your family in your home.

RescueMyLoan.com can help you negotiate a loan modification or new terms with your lender. This is a stressful time for you; you don’t have to go it alone.

We look forward to hearing from you and helping you stop foreclosure.