The steps to stop a foreclosure may include filing for bankruptcy, applying for a modified loan or filing a lawsuit against the lender. According to NOLO, if a homeowner files for bankruptcy, the foreclosure sale of his home is halted immediately. Applying for a modified loan also delays a foreclosure, and if the applicant is approved, it stops the foreclosure completely. Lawsuits can help to deal with lawbreaking lenders.
As of 2014, the U.S. Department of Housing and Urban Development has a number of programs to assist homeowners who are trying to avoid foreclosure. These programs include loan modification programs such as the Home Affordable Modification Program (HAMP), Principal Reduction Alternative (PRA) and Second Lien Modification Program (SLMP) among others. There are also special programs for homeowners who are unemployed.
Homeowners who want to stop or avoid foreclosure should speak with their lenders as soon as possible, advises Forbes. They should tell the mortgage lender why they are struggling and ask the lender to modify the loan. Once the loan has been modified, the homeowner should go over its terms carefully to make sure the changes really help, and if necessary, homeowners should consider selling their homes to avoid foreclosure.