Credit Nightmares: I Can’t Afford My House Payments

Posted by: Desiree B. | Jan 14,2008

If you can’t afford your house payments, it may be time to think creatively. Yesterday we talked about loan modifications and taking a break from loan payments with the permission of your lender. You have to look at every available option to avoid getting a home foreclosure reported in your credit history. Another option you can try when you can’t afford your house payment:

 

Deed in lieu of foreclosure transactions allow you transfer your home to your lender. You will still lose your home, but, you will avoid the home foreclosure notation on you credit report. If you get dinged for a mortgage foreclosure, it will stay in your credit history for 10 years and prevent you from getting another mortgage in the future.

 

Deed in lieu of foreclosure allows you to avoid the legal expenses associated with home foreclosure. In addition, deed in lieu of foreclosure means that you can avoid the more public embarrassment of a mortgage foreclosure. It’s frankly a lot less painful to voluntarily hand over your home to someone than it is to go through a foreclosure. A deed in lieu of foreclosure will also go on your credit report but it isn’t as severe as a mortgage foreclosure.

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