Your options
Tap each option. Start with your servicer and a free HUD-approved counselor; the earlier you act, the more options stay open.
Loan modification
Permanently changes your loan terms (rate, term, or adds missed amounts to the balance) to make payments affordable.
Pros
Keep the home; can lower payment; CA Homeowner Bill of Rights limits 'dual tracking' while a complete application is pending.
Cons
Paperwork-heavy; not guaranteed; balance may grow.
Forbearance
Temporarily pauses or reduces payments during a short-term hardship.
Pros
Quick breathing room.
Cons
Paused amount still owed; you need a plan for afterward.
Repayment plan
Catch up by paying your regular payment plus part of the past-due amount for several months.
Pros
Keeps the original loan; simple.
Cons
Higher monthly payment for a while.
Reinstatement
Pay all past-due amounts, fees and costs in one lump sum. In CA, generally available until 5 business days before the sale.
Pros
Stops the foreclosure; loan continues as before.
Cons
Requires a large sum of cash.
Selling with equity
If your home is worth more than you owe, a traditional sale lets you pay off the loan and keep the difference.
Pros
Protects your equity and credit; you choose the timing.
Cons
You move; needs time to list — start early.
Short sale
Selling for less than you owe, with the lender's approval.
Pros
Avoids a foreclosure on your record; in CA, first-mortgage deficiency is generally barred after an approved short sale (CCP § 580e).
Cons
Lender approval takes time; credit impact; possible tax consequences — ask a tax pro.
Deed in lieu
You voluntarily transfer the home to the lender to satisfy the loan.
Pros
Less damaging than foreclosure; sometimes includes relocation money.
Cons
You lose the home and equity; lenders often require trying a sale first; second liens complicate it.
Sale-leaseback
Sell to an investor who rents the home back to you.
Pros
May let you stay in the home and access equity.
Cons
Higher risk: read every document, get independent legal review, and beware 'equity purchase' scams. California has special equity-seller protections for homes in foreclosure (Civ. Code § 1695 et seq.).
Bankruptcy
Chapter 13 can stop a sale with the automatic stay and let you catch up over 3–5 years; Chapter 7 may delay it.
Pros
Powerful legal protection.
Cons
Serious long-term credit and legal effects. Talk to a bankruptcy attorney — this site cannot advise you.
Want to know what your home could sell for, or whether a short sale fits? Carlos will give you an honest, free opinion — even if the answer is that you should keep your home. 818.447.5224