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Prevent Foreclosure: The #1 “Stop Foreclosure” Secret Your Mortgage Holder Doesn’t Want You to Know

Updated on January 9, 2010

Want to Prevent Foreclosure? Here's a Fact You Need to Know


Are you facing the prospect of losing your home and are desperate to prevent foreclosure? This is undoubtedly a stressful, emotional rollercoaster of a ride of a time. But, there is one fact that you can hold on to that no one has ever told you. It can help you stress less, and look at the situation from a completely different point of view. Sometimes, it’s a matter of perspective; changing how you look at a given situation that can make all the difference. The information dispensed here is just that – to give you real hope of hanging onto your home.

What is this vital piece of information that can help you prevent foreclosure?

The “Prevent Foreclosure” Secret Your Mortgage Holder Doesn’t Want You to Know

There’s a powerful  not so secret “secret” your lender (mortgage holder) doesn’t want you to know that can literally help save your home. Why don’t they want you to know? Quite frankly because they realize that if you know it, you operate from a position of power, not fear. What is it?

It’s simple – your mortgage holder (eg, bank) doesn’t want your home. Furthermore, they want – no, need! – you to stay put. Even if you are several months behind, they STILL don’t want to foreclosure on you.

Right about now you may be thinking, “This is the big secret that can prevent foreclosure? You’re kidding me, right? Why don’t’ they want to foreclosure? What’s in it for them if I stay put?”

Prevent Foreclosure: The Games Mortgage Holders Play with Homeowners

In order to understand why your lender doesn’t want your home, you must understand how they operate. Eg, understand the games – for lack of a better word – they play.

You see, it’s in your mortgage holder’s favor if you fully buy into the fact that they don’t to prevent foreclosure. Why? Because they know that most homeowners (like you) will beg, borrow, steal and do everything in their power to keep their home – even when it’s beyond their financial power to do so.

And, this is exactly why many lenders refuse to work with homeowners – at least initially – to prevent foreclosure. They reason that if they continually threaten you with foreclosure, somehow, you’ll come up with the money to pay. And, many homeowners do, even if it means going into further debt.

THEN, just when it becomes really apparent that you really can’t continue to pay your mortgage and you start falling behind, they’ll “magically” start to work with you, offering solutions like  home loan modifications, foreclosure refinancing, principal reductions and other stop foreclosure solutions.

Prevent Foreclosure: Why Being Late with Your Mortgage Payment Can Work in Your Favor

Much like credit card debt, being late with your mortgage payment can actually work in your favor. Now, is it ideal? Of course not!

But, while it makes no sense on the surface, it works to homeowner advantage because it’s when lenders really start to sit up, take notice and are willing to come to the negotiating table.

Think about it this way – when payments are coming in, why would they listen when you tell them, “I need you to modify my payments; I can’t afford to pay this much each month.” But, you continue to send in payment – month after month after month after month.

Your cubbards may be bear; your savings may be depleted and you may be charging your mortgage to your Visa card each month. Your mortgage holder doesn’t know – or for that matter – care about that. All they know is that you ca prevent foreclosure by paying on time. And you do.

BUT, when you stop paying, then their bottom line is affected. Instead of you being afraid, then THEY become fearful that you’re going to do the “jingle mail walk,” which is what many homeowners have done since the foreclosure crisis started in the fall of 2007.

When a homeowner voluntarily walks away from the home and mails the keys in to the lender – which is what the jingle mail walk is – then they’re left holding the financial bag.

NOW, you’ve got their attention. To understand fully why, it helps to understand what it costs a lender to prevent foreclosure compared to what it costs to proceed with a foreclosure.

Prevent Foreclosure: What It Costs a Lender to Foreclosure on a Homeowner

According to the post, Foreclosure costs explained: $75,000 per house, the overall costs associated with foreclosing on a home is $78,000. And exactly hbow much does it costs a lender to stop foreclosure? A paltry $3,300. The post states:

“A report by the Joint Economic Committee of Congress estimates that the average cost of a foreclosure, to the homeowner, lender, local government, and neighbors (whose homes decline in value), is $78,000. By contrast, preventing the foreclosure would cost $3,300 per home on average.”

Prevent Foreclosure: Fees Mortgage Holders Pay When Homeowners Abandon a Property

And this is the real reason your mortgage holder doesn’t want to foreclose on you. They’re in the business of lending money . . . not buying and selling homes.  When a bank forecloses on a home, they  to come out of pocket for property taxes;;, HOA dues; property maintenance; property security; protect the property from vagrants, vandalism, etc.

And, they have to do this for months . . . or perhaps even a year or two until the property is resold. This can cost a small fortune!

Hence, even when a homeowner like you falls a few months behind in mortgage payments, it’s in the mortgage holder’s favor to work with them. And thank goodness, many lenders are starting to realize this. This is why the first step in stopping foreclosure is to call your lender.

Remember, you’re probably not as bad off as you think. You DO have the power to prevent foreclosure – in the vast majority of cases. Get more specific info (actually 7 really good detailed tips) on how to stop foreclosure in the video below.

Prevent Foreclosure: 7 Ways to Do So

How to Stop Foreclosure


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