Foreclosure is a nasty word that no one likes to hear about these days. However, as unfortunate as it is, we’re hearing it more and more on the news every day. Left and right homeowners are losing their homes to foreclosures. What you used to be almost a sure thing, owning your home, is now something that is difficult, at best, for many people. Interest rates are high. Cost of living is high. The cost of buying a home is very high. The rate of unemployment is also high. These factors all contribute to why so many homes are finding their way into foreclosure.
What used to be another almost sure thing, the VA Loans, are now just as shaky and tenuous. When a Veteran purchases a home, they are eligible for a VA loan, which is a government insured, VA guaranteed loan. What this means is that although they may get their financing from a bank, the VA is guaranteeing the bank that if the Veteran cannot make the payments, they will buy the loan back so the bank is not forced to foreclose on the Veterans.
Even though the bank is not going to be stuck with the home, they still try to help stop foreclosure. VA loans are usually given with lower interest rates than the traditional home mortgage. However, the bank and the Department of Veterans Affairs (VA) will still do everything they can to stop foreclosure of VA loans.
At the first sign of financial difficulties, in an attempt to stop foreclosure, the VA will offer the Veteran financial assistance. Sometimes, in spite of help, the Veteran still cannot make the required payments and the home still becomes repossessed. When it becomes repossessed (usually after three or more consecutive missed payments), the VA will pay off the loan and become the new owner of the home. They will then attempt to sell the home to any interested buyers. Often, they list the home with a real estate agency that will advertise the home for a period. They may take bids on the home with the highest bidder getting the home.
No one likes seeing a home go into foreclosure. Bank officials offer Veterans different tips on how to stop foreclosure. VA loans are usually given with better lending terms and interest rates as a way to help the Veteran. Therefore, it’s important to keep the home if possible.
One of the more important things you can do to stop foreclosure of VA loans is contact the VA and the bank if you are experiencing financial difficulties and find making the payments difficult. Banks have many options available in home loans. Perhaps they can find a different type of loan to give you so your payments are more affordable. Too many home owners make the mistake of not contacting their lenders until it’s too late. Don’t let this be your mistake.