Veteran Facing Foreclosure? What Are Your Options?
If you've recently fallen behind on your mortgage payments, you may be worried about your ability to keep your home. Once you've missed a payment, interest, fees, and penalties can begin adding up quickly. Fortunately, there are some foreclosure-prevention services provided just for veterans, as well as federal laws that provide you with some extra protections. Read on to learn more about how you can fight against foreclosure.
What laws specifically govern foreclosure of veterans' homes?
After the national foreclosure crisis that began last decade, Congress passed a number of laws and regulations designed to help prevent enlisted and deployed servicemembers from returning home to find a foreclosure notice (or worse, find that their house had already been sold at sheriff's sale).
The Servicemembers Civil Relief Act (SCRA) helps protect you from foreclosure while you're deployed. If a foreclosure is filed with the court while you're on active duty, the case is not permitted to proceed until you return. If, for some reason, a foreclosure judgment has already been entered against you while you were gone, you may be able to have the judgment re-opened and set aside to allow you to argue your case (or seek modification of your loan).
The SCRA also provides additional protections that may help you avoid foreclosure entirely. For example, if you've been called for a permanent change of stations (PCS) and are having trouble selling your house for the mortgaged amount, you will automatically be eligible for a short sale, rather than having to obtain prior approval from the bank.
If you'd rather keep your home and rent it out, you may be able to modify your mortgage (lowering the interest rate and extending the term to make the monthly payment more affordable) without having to fall behind on your payments first.
What foreclosure prevention services are available for veterans?
In addition to these protections, veterans are eligible for foreclosure assistance from the U.S. Department of Veterans Affairs (VA). A VA representative can help you contact your lender to discuss your options, as well as help you qualify for certain loan benefits (like a VA refinance).
The Department of Housing and Urban Development (HUD) also offers free housing counseling services through a number of local agencies. These housing counselors can also assist you in negotiating with your lender to reach an agreement that allows you to either keep your home or walk away without significantly damaging your credit. For more information, check out companies such as Harold Jarnicki Attorney At Law.