As part of a new website launched this week, Freddie Mac is now offering distressed homeowners a complete guide to foreclosure and prevention, from assessing your situation to what to do when your home has been foreclosed on.
“MyHome by Freddie Mac” is an option on Freddie Mac’s site offering homeowners various options under the “Foreclosure and Alternatives” tab that guide a borrower on who to contact for help, as well as non-foreclosure solutions that include both home retention and home forfeiture options.
Freddie Mac initiates their discussion with a brief overview on the importance of getting an understanding of your financial situation and determining what a borrower can and cannot pay for in their home upkeep. If a borrower cannot pay for these things, continues to incur major expenses that keep them from paying the mortgage, Freddie Mac recommends reaching out to the lender as soon as possible.
Borrowers are warned to watch for the warning signs of foreclosure and to seek help if they look familiar. If a borrower needs guidance on avoiding foreclosure, Freddie Mac lists several options to contact for help: the lender, housing counselors, Freddie Mac borrower help centers, and house finance agencies. The key is to seek assistance before it becomes a permanent problem.
Some home retention solutions discussed for eligible borrowers are forbearance, reinstatements, repayment plans, and modifications, including the government’s Home Affordable Modification Program (HAMP). Non-foreclosure solutions in which the home is forfeited include short sales or deeds-in-lieu of foreclosure. There are several resources provided on the site to assist the borrower in understanding the options and how to properly prepare your financial documentation before meeting with the lender.
For situations where foreclosure cannot be avoided, Freddie Mac gives the borrower a list of what to expect after foreclosure that includes how it affects the borrower’s credit, how to rebuild credit, finding a home after foreclosure, and re-entering the housing market.
Additional options provided to homeowners who have already lost their home to foreclosure include: finding out who purchased the home after the foreclosure to increase options available. In some situations, if Freddie Mac acquired the home, options may include renting the home back while it’s being marketed for sale, receiving “cash for keys,” or purchasing the home back.
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