Foreclosure is a legal process that involves the lender taking back ownership of a mortgage property and then selling it. This occurs because a homeowner's loan is in default or the owner is delinquent with the necessary mortgage dues.

Below is a list of home retention options which are designed to help financially troubled homeowners keep their home.

Home Affordable Modification Program (HAMP)

Lowers the monthly mortgage payment to 31% of verified Gross income by lowering interest rate, extending loan term or reducing principal amount;

- Must own a one-four unit home as a primary residence
- Must have received mortgage on or before January 1, 2009
- Must have a monthly mortgage payment that's more than 31%   of monthly Gross income
- Must complete a 3-4 month trial period after initial loan   modification is complete before the mortgage is permanently   modified
- Less impact on credit score than a foreclosure

Principal Reduction Alternative (PRA)

Designed to help qualified homeowners with homes which are worth significantly less than the balance owed;

- Mortgage must not be owned or guaranteed by Fannie Mae or Freddie Mac
- Balance owed must be more than home's value
- Must be your primary residence
- Must have received mortgage on or before January 1, 2009
- Must have a monthly mortgage payment that's more than 31% of monthly Gross income

Traditional (in-house) Loan Modification

Lowers the monthly mortgage payment to a more affordable amount by either lowering the interest rate, extending the loan term or reducing the principal amount;

- Benefits borrowers who do not qualify for HAMP
- Lenders set their own guidelines and qualifications
- May be applied to any property
- Less impact on credit score than a foreclosure

Home Affordable Unemployment Program (UP)

Allows qualified homeowners to pay only a portion (or nothing at all in some cases) of regular mortgage amount for a minimum of 3 months;

- Must own a one-four unit home as a primary residence
- Must have received mortgage on or before January 1, 2009
- Must be able to provide proof of currently receiving   unemployment benefits
- Less impact on credit score than a foreclosure

Home Affordable Refinance Program (HARP)

Insures that a qualified current homeowner stays current on mortgage;

- Must own a one-four unit home as a primary residence
- Mortgage must be owned or guaranteed by Fannie Mae or   Freddie Mac
- Must be current on mortgage for the last 12 months
- First mortgage must not exceed 125% of current market value   of home
- No impact on credit score

Forbearance

Allows qualified homeowners to pay only a portion (or nothing at all in some cases) of regular mortgage amount for a specific period of time;

- Offset amount will need to be repaid after forbearance is up
- Less impact on credit score than a foreclosure

Repayment Plan

Allows qualified homeowners to catch up on any past-due amount over a specific period of time;

- Less impact on credit score than a foreclosure

Second Lien Modification Program (2MP)

Lowers the monthly mortgage payment on Second mortgage;

- Must have the first mortgage already modified under HAMP
- Less impact on credit score than a foreclosure