Between the loose home lending practices common about a decade ago, and the housing decline and economic difficulties that followed, home foreclosures have been a common occurrence across the United States. If you are facing foreclosure, know that you are not alone. You have many steps you can take to work through the process.

Avoiding foreclosure

The best way to avoid foreclosure is to keep up with your mortgage payments. Even if your home is worth less than you owe on your mortgage, the bank cannot initiate a foreclosure unless you fall behind on payments. Therefore, plan your finances carefully to budget for your monthly payments if you want to keep your home. This may mean cutting back on other things you've become accustomed to, like cable TV, eating out, or having a gym membership.

If you can tell you are not going to be able to afford your payments, act quickly to do everything you can to keep up. Perhaps you have some assets you can sell, like an unneeded car or some valuable jewelry. Another option is to get a part-time job to help make up the shortfall in your monthly cash flow.

Working with lenders

The lender is not your enemy when it comes to foreclosure. Ultimately, the lender's preference would be for you to keep your home and continue making payments on it. Because of this, lenders are willing to work with you; especially if you are confident you can get back on track with your payments.

Be quick to respond to all communications from your lender about your mortgage or the potential for foreclosure. Even take the initiative to call your lender if you know you'll miss a payment. If you explain your situation, the lender will sometimes allow you to postpone payments or pay only interest for a short time. If you show you are willing to make financial sacrifices, lenders are often happy to work with you.

Understanding your options

Despite your best efforts, you may have a situation in which you really can't keep up with payments. In this scenario, you have two major options. The first is to work out a solution with your lender, whether it is refinancing, going through a loan modification or having a temporary change in required payments. The second is to allow the lender to foreclose on your house, which means you will move, and the lender will sell the house at an auction to repay your mortgage.

Watching out for scams

Thousands of individuals and companies prey on people who are facing foreclosure. You should never pay for third party help during a potential foreclosure, nor should you sign any documents unless you fully understand them. If it sounds too good to be true, that is probably because it is. You may unknowingly be signing over the title to your home! Instead, find a HUD-approved housing counselor by calling (800) 569-4287.