Hard financial times can fall upon just about any Coloradan. Hard times are not necessarily a person’s fault, but that does not make them any easier to deal with. People often have to make tough decisions. Do they pay the electric bill or pay for their prescriptions? Will they have enough gas in the car and food on their table to last until the next payday? Sometimes, people find that they are totally unable to pay their mortgage, and they may fear losing their home. They may wonder if there are ways to stop home foreclosure.

Fortunately, there may be some options for homeowners in such situations. For example, they could seek a forbearance. In a forbearance, a homeowner’s lender agrees to suspend the mortgage payments for a certain amount of time. Once that time period is up, the homeowner will continue paying their regular mortgage payments, as well as additional payments to catch up on what was missed. This can help those whose income is only temporarily reduced.

Another option may be a loan modification. In a loan modification, the lender agrees to permanently change the terms of the mortgage in a way that allows the homeowner to make regular payments. For example, the number of years a homeowner must pay back the mortgage may be extended, or the interest rate on the mortgage may be lowered. This might be useful to those who find their income will be reduced permanently.

A third option is filing for Chapter 13 bankruptcy. In a Chapter 13 bankruptcy, the debtor is allowed to keep their assets, including their home, so long as they make the required payments to a trustee under a court-ordered repayment plan. Once the repayment plan is complete, certain debts the person once owed will be discharged.

If a homeowner is considering any of these options, they should first understand the legal consequences of pursuing them. For example, if they fail to make payments once a forbearance is up or if they fail to make payments under a loan modification, their home may still be foreclosed on. And, if they choose bankruptcy, they must understand that it is a legal process handled by the court. Filing for bankruptcy can be complex, so a homeowner considering filing for bankruptcy to stop foreclosure will want to make sure they understand all applicable laws before continuing.