How to Stop Foreclosures in South Dakota
- 1). Contact a housing counselor to discuss options. Neighbor Works of Dakota is a nonprofit organization with various locations in South Dakota. Counselors ask basic questions about your mortgage and finances. After compiling your information, the counselor reviews your overall situation to present you with all possible options. Some homeowners are able to stop foreclosure by budgeting, others save their home through a loan modification. When keeping the home is not an option, a counselor can help you navigate the process of selling your home in a short sale. Contact Neighbor Works of Dakota by calling 800-823-1428. Additional housing counselors in your area can be found by visiting the South Dakota HUD website.
- 2). Pay the delinquent amount of the loan. If you are able to pay the past due balance before the sale of the home, you can stop the foreclosure. You will need to contact your lender to make arrangements to pay beforehand. After the lump-sum payment is received, your lender will reinstate the loan. Once you are current on the loan, consider applying for a loan modification to reduce your monthly payment. Even though it may seem challenging to gather the necessary funds, it is not impossible. Consider selling assets or asking a family member to co-sign for a personal loan. If you are unable to pay before the sale of the home, all hope is not lost. In South Dakota, homeowners have the right to redeem their foreclosed property. If you remain in the home through the foreclosure process, you have six months to pay the entire loan plus fees. If the property is abandoned, the redemption period is shortened to two months.
- 3). File bankruptcy. Both Chapter 7 and Chapter 13 bankruptcy are used to avoid foreclosure or to delay the process. South Dakota bankruptcy laws allow you to keep your home if you meet certain requirements. File Chapter 13 bankruptcy and continue making the current mortgage payment on your homestead property to avoid losing it in foreclosure. If you are looking for a clean slate, you can avoid foreclosure by filing Chapter 7 bankruptcy. It is always best to consult with an attorney before making a drastic decision since bankruptcy will have a significant impact on your credit rating. If you cannot afford an attorney, contact a legal aid organization. Dakota Plains Legal Service has several office locations throughout South Dakota and provides free assistance to qualified homeowners.
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