If you are gradually heading towards foreclosure and frantically looking for a way out,
debt consolidation can be an answer to your prayers at debt crisis. However if you credit
rating has taken a huge hit due to missing mortgage payments, you might face a little
difficulty to qualify for a consolidation loan. Despite this, you can certainly plan for
debt consolidation California or consolidation of debts in any other state of US reputable
credit counselor I swilling to help you out. Enrolling in a debt consolidation plan will
help you to convince your mortgage lenders that you take your financial obligations
quite seriously and restructure the loan so that you can afford to make timely mortgage
payments in the near future. Read on to know how to consolidate your outstanding debts
to stop foreclosure.
As the Federal Trade Commission strongly recommends that you seek the advice
of nonprofit counselors and avoid for-profit companies, you should fix a meeting
with a nonprofit credit counselor certified by the U.S. Department of Housing and
Urban Development. To find a good counselor in your community, you can visit
the HUD website.
To make the meting a success, stay prepared with a few details. Get an accurate
view of your financial situation. Assemble all billing statements for your debts,
mortgage bills and correspondence related to a possible foreclosure along with an
expense list for essential and non essential items. A credit counselor will certainly
recommend you a budget based on your income and expenses which will help
you to curtail unnecessary expenses and save more. This entire preparation will
be helpful during a three-way discussion with your Mortgage Company and credit
card companies and help you to turn the odds in your favor.
A counselor is the right person to tell you about the consolidation loans available
for you. Ideally, you can borrow a home equity loans, signature loans and debt
management plans to replace your existing debts but as your home is already on
the verge of foreclosure you won’t qualify for a home equity loan and bad credit
won’t allow you to apply for other consolidation loans. With a likely poor credit
score your best option or rather the only option remains a debt management plan,
which is offered by credit counseling agencies. Under this plan the counseling
agency will contact all your lenders and negotiate for lower monthly payments
at a lower interest rate and request them to waive the late fees or add- on charges
from your account. This repayment plan stretches for four to five years and during
this time you have to send the counseling agency a lump sum check each month
covering at least the minimum payments on all your credit cards combined.
Your next step is to ask the counselor to make a three-way call to your mortgage
lender with you on the line in order to stop them to foreclose the property.
Now, you can put forward a plea to stop the foreclosure procedure as you
have completely restructured your household budget and debts under expert
supervision of a government-accredited credit counselor and you can afford to
make your timely mortgage payments. Make sure your creditors must modify
your mortgage as part of your financial makeover. You never know, your newly
acquired ability to pay back the mortgage loan might persuade the lenders to
make loan payments and terms more viable. Hopefully, they can give consent
to tack the missed payments onto the back of the loan and stop foreclosing the
property.