Even if Montana resident knows that they have fallen behind on their mortgage payments, getting a foreclosure notice is scary.
Aside from other financial stress and underlying personal issues, the family will start to worry about where they are going to live.
They may also feel a sense of embarrassment over their situation, even though they know that many people find themselves in the same circumstances.
Under this sort of pressure, a family might not realize that they have several possible options for dealing with a pending foreclosure.
Understanding these options can help, even if none of them can make the problem go away completely. On the other hand, either doing nothing or making rash decisions can put a family in a worse position.
There are sometimes defenses to foreclosure cases
It is important for families to remember first and foremost that, although they are common, foreclosures are legal proceedings. Lenders have to prove their cases just as they would in any other type of lawsuit.
While not an option for all families, some families may actually have a legal defense or other means to avoid or delay a foreclosure case.
Families should consider speaking to an attorney about their options.
Many times, the best option is to work out an alternative with the bank
Even if a family is not in a position to fight a foreclosure case, there are other options that involve working with the lender.
After all, it is not ideal for lenders to foreclose. They prefer to have a borrower pay their full loan.
In some cases, a bank may be willing to modify the terms of its loan or allow a family not to make payments for a while and catch up later.
Even when this is not an option, many banks will cooperate with a so-called short sale.
In a short sale, a family can agree with the bank to sell the home for less than the amount of their loan. The family gives the proceeds of the sale to the bank, and the bank in turn forgives the rest of the loan.
Bankruptcy may be the best option to help in a foreclosure
Either a Chapter 13 or, in certain cases, a Chapter 7 bankruptcy may be a family’s best option if they are facing a foreclosure.
While these two different types of bankruptcies work differently with respect to foreclosures, both may be the best choice for families facing other financial problems as well as foreclosure. Montana families should understand this option and consider it carefully.