The foreclosure process is scary. If you’ve fallen significantly behind on your mortgage payments and they’re going to auction your home soon, then you need to know how to stop a foreclosure auction immediately! As the foreclosure process advances, it becomes progressively more complicated to stop it. Additionally, the longer it goes, it wreaks more and more havoc on your credit. A foreclosure can drop your credit score up to 250 points! Moreover, these negative marks don’t disappear right away. They take seven years to fall off. How To Stop A Foreclosure Auction Immediately: Three Methods Given how damaging a foreclosure can be to your financial stability, it’s typically in your best interest to stop the foreclosure as soon as you can. What you do, though, depends on your credit score and if you desire to remain in your home. Let’s look at three methods for stopping a foreclosure action immediately to understand the pros and cons of each better. How To Stop A Foreclosure Auction Immediately Idea #1: Bankruptcy One guaranteed way to stop foreclosure is to file for bankruptcy. The moment you file for bankruptcy, there is an automatic stay on the bank from initiating any action to collect on their debt. Consequently, this stay prohibits the bank from foreclosing on your property. Banks can request relief from this temporary stay, but that will take a month or two to work through the courts. Of course, this method lets you keep your home (at least temporarily), and you may be able to keep it long-term, depending on the outcome of the bankruptcy proceedings. The downside to bankruptcy is that it is devastating credit-wise. On top of the hundred or so point decrease due to being late on payments, a bankruptcy will result in another big point drop. If you plan on going this route, consult with a lawyer to see if it is right for you. Stopping Foreclosure Idea #2: Sell To A Cash Investor Many times, people that let their homes go into foreclosure can avoid the whole thing. Let’s suppose you have a home worth $300000 on which you owe $100,000. You get behind a few payments, and you try to work something out with the lender. They balk. You don’t want to keep the home and would prefer to alleviate your stress by walking away. Sell it! With traditional real estate selling, this process might be too long (3-6 months sometimes), but if you sell to a cash investor, they can complete the entire transaction in as little as a week. As long as the auction is at least a couple of weeks out, selling to a cash investor is probably the best method of how to stop a foreclosure auction immediately! Method #3: Loan Modification This method will stop the foreclosure immediately. However, the catch is that the bank must accept and approve the request. If the auction is at least 37 days out, then, as per Federal law, a bank must review a properly filled-out loan modification application. They do not have to agree to modify the terms of your loan, but the act of filling out the form will stall the process a couple of weeks, at least. If the auction happens within 37 days, then the bank can reject the request, and this will not affect the auction date. Many times, though, this good-faith effort on your part will receive some reciprocation by the financial institution, so it’s worth a shot if you want to keep your home! Stopping A Foreclosure Auction Can Be Done! Even though a bank has scheduled a foreclosure auction does not mean all hope is lost. If you want to keep your home, then bankruptcy and applying for a loan modification are your best bets. If you’re going to walk away and save your credit score so you can still buy a home later (honestly, frequently, this is the best choice), then selling to a cash investor is the way to have as little impact on your credit as possible. Get a no obligation fair cash offer here.
top of page
bottom of page