COMMON EXAMPLES OF FORECLOSURE PREVENTION OPTIONS

Option	How Does the Option Work?	Key Benefits
Repayment  Plan	Distributes delinquent payments over a period of time, usually no more than 10 months. A portion of the deferred delinquent amount is added to the normal monthly mortgage payment.	Brings account up to date in a specific time frame. Original Payments then resume thereafter.
Loan  Modification	A permanent change in one or more of the terms of the mortgage loan, allowing the loan to be reinstated to a "current" status, and resulting in a more affordable monthly mortgage loan payment. Past due interest and escrow are added to the new unpaid principal balance and re-amortized over the remaining life of the loan.	Changes the mortgage note itself, allowing a "fresh" start on managing the loan. Brings account up to date when loan modification is executed, with more affordable terms
Partial Claim (FHA Loans only)	A second mortgage, interest free, that is paid off at the time when the homeowner's loan is paid off. This option allows up to 12 months of past due accrued mortgage payments to be included in the second mortgage. Available only on FHA loans.	This type of FHA/HUD loan is interest-free.  Brings your account up to date immediately.
Fannie Mae Home Saver Advance	A low interest rate loan provided by first lien loan servicer to bring current a customer's delinquent first mortgage. The loan is repaid over a 15 yr term w/ pymt and interest accrual deferred during the first 6 mos. after the advance.  Only Fannie Mae loans.	Brings account up to date immediately. Second mortgage is secured at a low interest rate.
Short Sale	Allows you to sell your home and use the proceeds to pay off the mortgage if you are unable to maintain payments, even if the home's market value is less than the total amount owed.	Avoids the lengthy legal process involved in foreclosure.  Usually less damaging to credit than foreclosure.
Deed in Lieu of Foreclosure	Allows you to voluntarily transfer legal ownership of your property to lender if you are unable to maintain mortgage payments and cannot sell the home at current market value.  Sometimes, lender will pay relocation assistance to the borrower (“cash for keys”).	Avoids the lengthy legal process involved in foreclosure.  May be less damaging to credit than foreclosure.