Nobody wants to lose their home, but it is especially difficult for homeowners already facing hardship. A home is supposed to be a permanent safe haven, a space that families and individuals can escape the problems of the outside world and relax. While the threat of a Bergen County foreclosure can seem like a catastrophe to homeowners already facing financial hardship, there are several ways in which to prevent it.

Unfortunately for Bergen County homeowners, banks are not concerned with what a home symbolizes; they only care about the financial reasons that could result in you losing your home.

• Losing a source of income is a very common problem for homeowners facing foreclosure. Unemployment, for example, can cause a serious shortage in money needed to pay mortgages and bank loans. Divorce is another way in which New Jersey homeowners can lose a source of income needed to pay bills.

• Unexpected emergency expenses, such as medical emergencies and home repairs, can cause a shortage of money as well. Evidence of this fact, is the research results that indicate the leading cause of bankruptcy is medical bills.

• In some cases, Bergen County homeowners are forced to foreclose their home for no fault of their own; Mortgage fraud has become a serious risk in the past few decades.

• Increasing Mortgage rates and interest rates are just one more reason families are forced to leave their homes.

However, no matter how bleak the situation looks, it is important to take a deep breath and realize that there may be a way out of the impending foreclosure. Many options are currently available to homeowners to help stop or delay a New Jersey foreclosure of their house and it is important that homeowners be aware that there are many scams that can cost even more money in the long run. Consequently, it is imperative that you do the necessary research before leaping into any plan of action.

It is a good idea, before making a strategy, to first go back and understand how your finances went wrong in the first place. This will help prevent a dire financial situation from occurring again and insuring a more stable fiscal life. To help diagnose the problem, it might be a good idea to get financial advice; there are many non-profit organizations that offer financial assistance if money is preventing you from getting help.

Looking over your loan documents and original mortgage is also a good idea before taking any drastic measures. After talking over an accurate assessment of your income and total budget with a financial professional, it is time to make a plan to avoid foreclosure. There are many choices and decisions to be made when concerning different methods:

• Short Sale – A short sale typically has one of the highest success rates when dealing with foreclosures. In a Bergen County short sale, a lender permits a property to be sold for a smaller amount than what is owed on the mortgage. Because the property does not sell for a large enough amount to cover the homeowner’s debt, the lender accepts what part of the debt can be repaid from the sell and often forgives the rest of the debt.

• Loan Modification – Loan modifications are typically short term solutions and, for homeowners in difficult financial periods, can make a situation worse. This process entails modifying preexisting loans. These modifications can include interest rates, maturity dates, and any other terms of a loan. Loan modifications are typically much harder to get approved than a New Jersey short sale, and by dragging out payments, a homeowner will often end up owing a larger amount of interest on their house.

• Strategic Default – Many individuals turn to the strategic default method, which is sometimes referred to as “jingle mail” because a homeowner is metaphorically mailing their house keys to the bank. Strategic default is the decision of a homeowner to stop all payments on their debt. This most often happens when a house price drops substantially and the debt owed is now greater than the property value. While a borrower can live several months free of payments until the house is foreclosed, there are serious repercussions to this approach. The foreclosure will effectively lower the borrower’s credit rating, which makes obtaining loans extremely difficult and more expensive in the future.

• Forbearance – Forbearance, or “holding back”, is a deal between the borrower and lender to suspend a foreclosure. This option allows the Bergen County homeowner to catch up on their mortgage payments by a designated time. However, this method is only good for short term financial problems because the full debt still must be paid. Also, the decided time in which the homeowner has to catch up on payments, is not usually long enough to overcome a dire financial situation.

• Repayment Plans – New Jersey homeowners are allowed the chance to throw out the original schedule and establish a brand new time table for repayment of their loan. In theory, the borrower would only be paying a small amount of extra cash every month to repay the outstanding debt. Repayment plans, however, pose many of the same problems as Forbearance does; they both are good for short term financial problems but are almost impossible to stick to for anyone who has long term fiscal difficulty.

In short, there are many options for homeowners facing foreclosure, but unless you are having short term financial problems, most of them are just temporary fixes. Bergen County short sales allow for a clear escape from impending debt and are often the preferred choice of those in immense financial trouble.

There are several real estate companies that can be found online, which specialize in mortgage short sales. In order to prevent scams and unfavorable selling conditions, it is highly advisable that you find a Realtor experienced in New Jersey short sales to help. Fortunately, some of these companies offer no cost assistance and can connect you to a local real estate agent who can help you with your individual situation. Foreclosure can be a scary fact of life but with the right information, informed choices, and hard work, it is possible to put your financial troubles behind you and get a fresh start for your family.