How to Reverse Foreclosure of Your Home

How to Reverse Foreclosure of Your Home
A home in foreclosure sells at auction.

Offer to make up missed payments. If you feel as though your financial hardships are short-term and that staying in your home is in your best interest, ask the lender to work with you by giving you time to make up the missed payments. For example, if you've missed three payments of $1,000, the lender may give you six months or a year to pay them a lump sum of $3,000.

Modify your loan. If you work your budget and believe that you can afford to stay in your home with a modified loan agreement, talk to your lender about the possibility. For instance, if you have a 7 percent interest rate, but by giving you a 5 percent interest rate the lender can lower your monthly payment by a few hundred dollars, it may be worth your effort. If you have an interest-only loan, modifying it won't help since the modification process payments are calculated using principle, interest, taxes and insurance.

Sell your home for a profit. If you're not upside-down on your house, meaning you don't owe more than it's worth, you can sell it and get a fresh start. A real estate professional can help you determine how much homes in your neighborhood are selling for and tell you how the market in your area is doing.

Unload your home through a short sale. If you do owe more on your home than it's worth, talk to your lender about doing a short sale. When a lender agrees to a short sale, you can put your home on the market at its current value and the lender will take the loss between the sales price and what you owe. The lender assumes responsibility for closing costs, real estate fees and any other expense of selling the property.

Talk to an attorney. If you feel as though your home is being wrongfully foreclosed upon, seek the council of a lawyer who can help you map out your best options.