If you are already behind by two or three months in your home loan payments and the bank has already sent you a default notice and a final warning that the next document would be a foreclosure notice, you are now probably considering obtaining stop foreclosure loans to pay your arrears plus the interest and other charges to save your home from foreclosure.
But before proceeding to borrow to pay your arrears, examine your financial situation. Make sure that the high interest and fees you are going to suffer from your emergency loans make financial sense.
After you have restored your home loan account into current status, ask yourself if you have the money to keep making the payments without borrowing again. Check also if you can pay your emergency loans while you are paying your home loan payments.
Otherwise, you will just put yourself into lots of debts and stress and destroy your access to credit for many years to come just to save your home.
Most often, the types of loans that you can obtain quickly in an emergency situation are payday loans, online loans, credit card loans, credit card cash advances, online loans, peer-to-peer loans and other types of unsecured personal loans. These are often easy to get if your FICO credit score is at least 580, but you will get them at high interest fees at very short terms and sometimes with upfront processing fees.
Nowadays, there are also lenders providing no-credit-check loans and bad-credit loans, but these are provided to borrowers at high costs since the lenders are taking great risks in providing the loans.
On the other hand, if you are a borrower that suffered just a temporary setback, such as a medical expense, but you still have your job, borrowing high-cost loans to save your home from foreclosure makes financial sense.
It means that after you have paid your arrears with emergency loans, you are able to pay these loans while keeping up with your monthly home loan payments.
To have a clearer understanding of your financial situation, go to a certified HUD foreclosure prevention counselor or a nonprofit financial counselor. Bring all your home loan and financial documents so the counselor can make the right calculations. A good counselor will be able to tell you honestly if you are able to save your home or if you are better off following alternative options.