Steps to Avoid Foreclosure -
How to Save Your Credit and Equity
If foreclosure is on the horizon, the most dangerous move is doing nothing. When life throws a sudden hardship—job loss, medical issues, divorce, or unexpected expenses—mortgage payments are often the first thing to slip. The good news? There are immediate steps you can take to stabilize your situation and protect your future before foreclosure becomes inevitable.
Below are practical, time-sensitive actions you should take as soon as foreclosure becomes a concern.
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Before assuming you’re out of options, take a hard look at short-term cash flow.
Contact utility companies (electric, water, gas, internet) and ask about hardship programs, payment plans, or temporary deferrals.
Look into local financial assistance programs, nonprofits, or county relief funds
Temporarily rerouting funds from utilities or unsecured debts may free up enough cash to get through an acute hardship
🔴ACTION: Conduct a brief online search for financial assistance for ________ in [city, state].
Many homeowners don’t realize that a 30–90 day reprieve can be enough to reset the situation—if acted on quickly.
Related read: How Short-Term Cash Flow Fixes Can Stop a Financial Spiral
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If you’re a veteran, this step is critical.
Contact your local VA office and apply for health benefits if you’re not already enrolled
Request a VA case worker—they can help navigate mortgage assistance, homestead exemptions, and hardship relief
Ask specifically about VA mortgage assistance programs and emergency resources
🔴ACTION: Conduct a brief online search for Veteran’s assistance in [city, state].
Veterans often qualify for benefits they were never told about. A single phone call can unlock multiple support paths.
Related read: Foreclosure Help for Veterans: Benefits Most Homeowners Miss
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This is one of the most uncomfortable steps—but also one of the most powerful.
Call your lender as soon as you experience hardship
Clearly state that you are facing a temporary or ongoing hardship
Ask about:
Forbearance
Loan modification
Repayment plans
Temporary payment reductions
🔴ACTION: Take out your last statement and find the phone number. Call us or call on your own, but make sure to reach out.
The earlier you communicate, the more options lenders are willing to discuss. Silence is often interpreted as an inability or unwillingness to cooperate—neither works in your favor.
Related read: What to Say (and Not Say) When Calling Your Mortgage Lender
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Foreclosure is not a single event—it’s a process with deadlines.
Find out:
How many payments can you miss before the account goes to default.
Whether a foreclosure sale date has been scheduled
How much time you realistically have
🔴ACTION: Take out your last statement and find the phone number. Call us or call on your own, but make sure to reach out.
Knowing your timeline allows you to make strategic decisions instead of reactive ones.
Related read: Understanding the Foreclosure Timeline in Texas
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If keeping the home may no longer be realistic, that doesn’t mean losing everything.
Options may include:
Selling before foreclosure to preserve equity
Structured sales or equity partnerships
Auctions designed to create real price discovery
Alternatives that protect credit, housing stability, and future homeownership
The key is evaluating options early, not after the bank takes control.
Related read: Selling Before Foreclosure: How to Protect Your Credit and Equity
