Mortgage Foreclosures in Pennsylvania Are On the Rise
The current economic situation has put a strain on many people. This is resulting in an increase in mortgage foreclosures.
The best way to stop mortgage foreclosures is to work proactively with your bank. So, what is going on with mortgage foreclosures?
Mortgage Foreclosures in PA Are On the Rise
Foreclosure filings are on the rise across the country. Rates in Philadelphia are only getting worse. In the first half of 2022, foreclosure rates were 134% over the first half of 2021. Pennsylvania ranks 20th in the nation with one in every 1,038 homes being in foreclosure. Part of the rise was caused by banks being more forgiving during the COVID-19 pandemic, and now returning to pre-pandemic expectations.
Also potentially contributing are soaring home prices, which may have caused some people to spend over their budget and then find themselves unable to keep up.
Pennsylvania sheriff sales are likely to follow as foreclosed homes go on the market.
Steps to Take Before a Mortgage Foreclosure
So, how can you avoid becoming part of these statistics? Here are some steps you can take:
- Don’t ignore it. The problem will not go away.
- As soon as you realize you may have issues paying your mortgage, proactively contact your lender. The last thing a bank wants to do is foreclose. It’s a pain for them to offload the house. They would rather work with you on a payment plan you can keep up with.
- Make sure to open and respond to all mail from your lender. Again, they don’t want to foreclose, so often initial notices contain resources that might help, and later ones might talk about legal action.
- Know your rights. Re-read your loan documents so you understand what might happen if you are foreclosed on.
- Contact a trained lawyer or a housing counselor. Do not contact paid foreclosure prevention companies or companies that claim they can stop mortgage foreclosures instantly; these are typically scams at worst, overly expensive at best.
- Rework your budget. See what expenses you can cut out without causing hardship, and also look for assets you can sell for cash and opportunities for an extra job or side hustle. These can make a difference and also show your lender that you are serious and willing to make sacrifices.
- If you have a lot of other debt as well, bankruptcy may be your best option. Typically, your primary home is protected during bankruptcy proceedings and you can lower the costs of your other loans so that you can keep paying your mortgage.
- Short selling is an option if you are willing to move. Consider your other housing options before selling, however. You can also get a deed-in-lieu of foreclosure, which does not show up on your credit score as badly as an actual foreclosure and helps you avoid further debt. Note that this will not work if you have any other financial obligations attached to the property, and this includes HOA liens. That is, you often cannot do this if your neighborhood has a HOA.
Save Your Home Today With Cibik Law
Cibik Law can help you avoid foreclosure and stay in your home. We are trusted bankruptcy lawyers who can help you properly assess all of your options, including bankruptcy, and help you stay in your home and move on. We can also help you with your various legal options through the foreclosure process, including assistance with short sales, setting up payment and loan modification plans, etc. We can also help you decide whether Chapter 7 or Chapter 13 bankruptcy is your best option.
Cibik Law can help you get out from under debt, stay in your home, and get a financial fresh start.