If you are currently a mortgage holder and you are having difficulty making your payments, first consult your lender or loan officer to explore options other than foreclosure, such as seeking a forbearance, loan modification, refinance, or selling your home through a short sale.

There are loan modification programs and refinancing options being offered through the following organizations:

• Making Home Affordable from the U.S. Department of Treasury
• Fannie Mae
• Freddie Mac
• HOPE NOW - (888) 995-HOPE (4673) - a HUD-approved alliance that provides free foreclosure prevention assistance.
• HOPE for Homeowners program, which allows distressed borrowers to refinance into affordable, government-back mortgages.

Contact a housing counselor in New Jersey. They can offer guidance to hopefully lead you to recovery and help you stay in your home.

If losing your home is in the foreseeable future, it may be in your favor to consider a short sale. The short sale's effect on credit may not be as detrimental as a foreclosure.

A short sale* is a transaction for the sale and purchase of real property where the purchase price is less than the amount required to pay off the liens on the real property, such as mortgages, judgments, taxes, homeowner or condominium association fees, assessments, as well as closing costs including but not limited to brokerage commissions, realty transfer fee, and attorney's fees.

It is recommended that homeowners contact a knowledgeable REALTOR® to help navigate a short sale transaction and market the property to potential buyers. Look for a REALTOR® in your area. Short sales can be lengthy processes as they tend to involve numerous parties, such as the lender and any other lien holders.

Read more about the difference between a short sale and foreclosure.

Beware of foreclosure recovery scams, or fraudulent companies that target borrowers at risk for losing their home. Read the warning signs to protect yourself from becoming a victim. Only consult trustworthy resources from state and local government agencies aimed at helping you to avoid foreclosure.

Resources for Improving Credit & Avoiding Scams

Foreclosure Mediation from the N.J. Judiciary
Making Home Affordable from the U.S. Department of Treasury
Mortgage Tips from the Federal Reserve Board
HOPE NOW - (888) 995-HOPE (4673) - a HUD-approved alliance that provides free foreclosure prevention assistance.
How You Can Avoid Foreclosure and Keep Your Home, from HUD
HOPE for Homeowners program, which allows distressed borrowers to refinance into affordable, government-back mortgages.
Credit Repair: How to Help Yourself from the Federal Trade Commission
Foreclosure Resources from the Federal Reserve
My Money, My Home, My Future toolkit from HUD to help "get your financial house in order."
NJ Home Ownership Preservation Effort
NJ 2-1-1 is available by dialing 2-1-1 or accessing online, with information on housing assistance, utility support and other helpful community programs

Predatory Lending and Short Sale/Foreclosure resources for consumers from NJAR®

Brochures are also available from the U.S. Department of the Treasury (Consumer Tips for Avoiding Mortgage Modification Scams and Mortgage Rescue Scams) and the Office of Thrift Supervision (Foreclosure Rescue Scams/How to Avoid Becoming a Victim).

*Short sales can have serious legal, credit and tax implications. Navigating through these long and often-confusing transactions can be difficult. It is advised that you work with a knowledgeable REALTOR® and consult an attorney or tax professional with regard to potential short sales whenever possible.

Columnist Karen DeMarco is a REALTOR® and a licensed New Jersey Real Estate Agent with Winfar Real Estate in Fort Lee, New Jersey. Contact Karen today at www.KarenDeMarco.com for assistance with all of your real estate needs.

Copyright 2009 New Jersey Association of REALTORS®. All rights reserved.
For more information, please visit www.njar.com