Foreclosure

NeighborWorks Sacramento Region

NeighborWorks has also recently partnered with the Institute for Administrative Justice, University of the Pacific McGeorge School of Law to provide legal assistance to homeowners following foreclosure prevention counseling at no cost to the homeowner. View the Press Release (PDF) about the partnership.

Tips on Avoiding Foreclosure

  • Don't ignore the problem. The further behind you become, the harder it will be to reinstate your loan and the more likely you will lose your house. 
  • Contact your lender as soon as you realize that you have a problem. Lenders do not want your house. They have options to help borrowers through difficult times. 
  • Open and respond to all mail from your lender. The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. 
  • Know your mortgage rights. Find your loan documents and read them so you know what your lender may do if you can't make your payments. Learn about the foreclosure laws and timeframes in your state (as every state is different) by contacting the State Government Housing Office. 
  • Understand foreclosure prevention options. Valuable information about foreclosure-prevention options can be found online. 
  • Contact a HUD-approved housing counselor. The U.S. Department of Housing and Urban Development (HUD) funds free or very-low-cost housing counseling nationwide. Find a HUD-approved housing counselor near you or call 800-569-4287 or TTY 800-877-8339. 
  • Prioritize your spending. Review your finances and see where you can cut spending in order to make your mortgage payment. 
  • Use your assets. Do you have assets -- a second car, jewelry - that you can sell for cash to help reinstate your loan? Demonstrate to your lender you are willing to make sacrifices to keep your home. 
  • Avoid foreclosure-prevention companies. You don't need to pay fees for foreclosure-prevention help - use that money to pay for your mortgage instead. While these may be legitimate businesses, they will charge you a hefty fee. For information or services your lender or HUD-approved housing counselor will provide for free if you contact them. 

Don't be a Victim of Fraud

Scam artists follow the headlines and are taking advantage of homeowners who are falling behind on their mortgage payments. Their pitches may sound like a solution to your problem, but their intentions are less than honorable. In general, always make sure you are dealing with a HUD-approved Housing Counseling Agency. Be suspicious of the following activities:

  • Be careful if someone calls or comes to your home offering to help. If you are contacted by a foreclosure prevention specialist, they are often phony counselors who charge unreasonable fees for making a few phone calls or completing some paperwork that the homeowner could easily do for him or herself. None of these actions result in saving the home. This scam gives homeowners a false sense of hope, delays them from seeking qualified help, and exposes their personal financial information.
  • Be weary of someone who offers to help you stay in the home if you pay rent. Homeowners are deceived into signing over the deed to their home to a scam artist who tells them they will be able to remain in the house as a renter and eventually buy it back. Usually the terms of this scheme are so demanding that the buy-back becomes impossible, the homeowner gets evicted, and the "rescuer" walks off with most or all of the equity.
  • Be careful if someone asks for a security deposit and first month's rent in cash for a rental home.

Reporting Fraud

View the Federal Reserve Tips on Avoiding Fraud website for additional information. To report a fraud, call:

  • Federal Fraud Hotline
    Phone: 1-800-437-2838
  • California Attorney General's Office
    Phone: 1-866-275-2677

Other Resources