How much equity is in the property is a good starting point.
If the equity is substantial, then it's more than likely well worth the effort to save the home.
If not, or if the equity has declined to the point where there isn't much left due to the recent severe decline in housing values, then it may not make sense to save the home.
What is the long term financial situation for the homeowner? The answer to this question will certainly factor into the decision as well.
If the adverse financial situation of the homeowner is only temporary, then they will likely lean towards saving the home.
However, if the adverse financial situation is more long term, then they may lean the other way.
A number of other reasons could certainly affect a homeowner's decision, but hopefully the homeowner will not let the emotion of the situation affect the decision making process.
Yes, My Home is Worth Saving - Now What? The first step, if this hasn't already been done, is to speak with the bank about the situation and see if a payment agreement can be made.
The bank does not want to own the home any more than the homeowner wants to get rid of it, so sometimes something can be worked out.
At the very least, the bank will appreciate the open line of communication, which could be very beneficial in the future.
While there are several options to help a homeowner stop foreclosure, obtaining a loan modification could be the best bet.
To apply for this, the homeowner will need to gather items such as recent pay stubs, mortgage statements, bills, etc.
The current administration is really pushing the banks and mortgage lenders to help homeowners as much as possible, so this may be a real option.
Another option, although not nearly as desirable as a loan modification, is a short sale.
In this case, the homeowner would put the property up for the sale like in any other instance.
However, any offers made on the property must also be provided to the bank because the bank has the authority to accept an offer they deem appropriate.
The money from the home sale goes directly to the bank, which in turn takes the homeowner off the mortgage, thereby absolving the homeowner of their current debt.
Essential Tips When a homeowner faces foreclosure, waiting for things to clear themselves up is not an option.
Time is of the essence, and a homeowner should immediately contact their bank to try and work something out.
Hopefully a loan modification is an option, but if not a short sale may be the only option left.
A homeowner should utilize as many resources as possible and determine the best course of action.