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Tuesday, November 17, 2009

Foreclosure Prevention Plan

By Kristin Johnston

If you have fallen behind in your monthly housing payment and are concerned that your mortgage lender may foreclose on your house you should know there are options available to help you get back on your feet. There are many home loan assistance programs created to allow underwater home owners reduce their monthly payments.

Avoiding foreclosure does not stop with a public assistance plan and reduced payments. Once you are on solid financial footing you must also think out and follow a sound financial plan.

There are many public programs intended to help borrowers to avoid foreclosure. Through relief programs such as mortgage modification and home loan refinance struggling mortgage holders may be able to reduce their mortgage payment. Mortgage modification is a special agreement you negotiate with your lender to alter specific terms of your mortgage contract.

Loan modifications are often used to change the repayment schedule of home loan contracts, usually making them lower to reduce pressure on homeowners. The other type of government mortgage assistance program is home loan refinance.

Mortgage refinancing requires an entirely new mortgage agreement to be taken out. Loan modification merely changes a few parts of an agreement while refinancing replaces the entire thing with a new agreement. Mortgage refinancing can happen with a different lender.

If you are qualified for aid and use the programs to get stable there are several things you still should do to avoid foreclosure. It is vital that you closely adhere to a sensible financial budget.

By spending unwisely there is a good chance you will find yourself facing foreclosure again in the future. If you are serious about preventing foreclosure and reclaiming your financial future it is important to do more than find a program to help you out now.

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