Foreclosure is the biggest risk homeowner must be prepared for when taking mortgage loan. With great financial planning, this situation can actually be avoided way before it happens. Nonetheless, when foreclosure is impending, alternative measures must be taken. There are several Bank of America mortgage foreclosure alternatives that are suggested by this bank to homeowners in pinch.
Foreclosure and Its Possible Alternatives
When loan borrower breaks one or more term of agreements in a loan, bank or Mortgage Company will have the right to sell their mortgaged property. The most common agreement violation is failure to make monthly installment. There are also several cases where homeowner is delegating property ownership to another person then paying off their mortgage loan without bank’s knowledge and approval. The mortgaged property will most likely be auctioned publicly. Property from Bank of American mortgage foreclosure which is bid under minimum amount will be owned by this bank.
Homeowner who receives Bank of America mortgage foreclosure notice is expected to contact the bank as soon as possible. Together with the bank’s lending specialist, they will figure out whether homeowner is qualified for available loan assistant program. Foreclosure process will not be started when homeowner’s document is being evaluated for assistant program.
It is suggested that homeowner contacts the bank immediately when they anticipate not being able on making their current monthly payments anymore. Bank of America mortgage foreclosure can be averted by approaching varied alternatives. If homeowner reaches out to the bank before they receive notice of foreclosure, there will be more alternative choices to be explored.
There are some alternatives to Bank of America mortgage foreclosure for homeowner who wishes to stay within their property. The first option is refinancing. This option will allow homeowner to lower current monthly payment to their level of financial ability. The bank also offers forbearance which allows homeowner to reduce monthly payment or even not making payment at all during a certain period (usually for three months). The missing installments will be added to homeowner’s monthly payments in the future once they have regained financial stability. This bank also serves loan modification for qualified homeowner so they can make their loan program more sustainable and within financial ability range.
This bank also offers Bank of America mortgage foreclosure alternatives which are supported by government. The first program is called Home Affordable Refinance Program by federal government. Sometimes, homeowner cannot meet refinancing qualification because their property’s value is lower than principal balance. With this program, homeowner in such condition can apply for refinancing. Federal government also put up a program named Hardest Hit Fund. Participating states are usually the ones most perturbed by declining of property value and economic recession.
If homeowner decides to move out from their house, Bank of America mortgage foreclosure alternatives are also available. Deed in lieu is a possible alternative for this case. When conducting deed in lieu, homeowner transfers property deed and ownership to the bank. This means bank will shoulder any responsibility that comes with owning the mortgaged property. However, deed in lieu will reduce homeowner’s credit score. Another option is called short sale. It means that homeowner is selling their mortgaged property and concluding their loan for an amount that is less than their debt.