Aug 23 2009
Only Stipulate If You Are Happy With Your Current Mortgage Terms
4. Forbearance- This is used most of the time, when a Notice of Default has been filed. You are allowed to delay or reduce payments for a short period, with the understanding that another option will be used at the close of that time to bring your account to a current status. Your lender, if in agreement, will then temporarily cease legal actions.
A forbearance agreement is usually referred to as a stipulation agreement. The terms of a stipulation agreement require you to waive all defenses to the foreclosure action and for you to make six or more monthly payments of higher than your previous mortgage amount in order to be considered for a loan modification. I do not recommend entering into a stipulation agreement unless you are happy with the terms of your current mortgage, but had previously fallen on hard times.
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