Foreclosures seem to be slowing, but the country still isn’t in the clear. If your home is in danger of facing foreclosure becuase of a HELOC in default, it’s important to have some idea of what the bank will do. Here are the five primary ways HELOC foreclosure situations play out:

1. The homeowner is given permission to offer a short-sale.
2. The homeowner is given permission to offer a short-sale because the primary mortgage holder offers a monetary incentive to the HELOC lender.
3. The primary lender forces a foreclosure.
4. The HELOC lender forces a foreclosure.
5. The HELOC lender purchases the primary loan.

Each of these five possibilities offers unique benefits and drawbacks to the homeowner. Take a look at the article HELOC Foreclosure to learn more about how to make the most of your situation in each possibility.

photo credit: stevendepolo

Tags | foreclosure, HELOC foreclosure, mortgage crisis