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Ohio Foreclosure Defense & Consumer Law > Blog > Foreclosure Defense > What Is Loss Mitigation? Options To Avoid Foreclosure

What Is Loss Mitigation? Options To Avoid Foreclosure


Certain loss mitigation options can help you keep your home, such as Loan Modification and Forbearance. Sometimes also referred to as “retention,“ Loss Mitigation describes the process of lenders assisting borrowers who are struggling to make monthly mortgage payments by providing them with repayment or relief options in order to avoid foreclosure.

As a result, if you are falling behind on mortgage payments, you want to get in touch with a Columbus foreclosure defense attorney right away to discuss these Loss Mitigation options and avoid foreclosure, if possible. Ultimately, it is in the lenders’ best interest to help borrowers find ways to repay their mortgage and minimize losses. 


Forbearance allows a borrower to temporarily stop or reduce monthly payments. The total unpaid amount is added to the borrower’s balance and repaid based upon an agreed-upon schedule after the Forbearance period expires.

Lenders will sometimes offer an initial Forbearance period (for example, of six months), and then the option to extend that period. When the Forbearance period ends, the borrower will typically resume their previous mortgage payment schedule with the unpaid amount over that six or twelve month period.


A Deferral involves repaying the unpaid amount that accrued during Forbearance at the end of the mortgage term, or when the home is refinanced or sold.

Partial Claim

A Partial Claim is similar to a Deferral, however, it involves obtaining an interest-free loan from the U.S. Department of Housing and Urban Development which bundles the payments and allows the borrower to pay them back and avoid foreclosure.

Repayment Plans

Forbearance and its associated options aren’t the only route a borrower can take: A lender can also structure a Repayment Plan so as to pay back what the borrower owes over a period of time.

Mortgage Loan Modifications

Mortgage Loan Modifications are another option, whereby the terms of a loan are permanently changed. This often includes the interest rate or repayment structure.


Reinstatement is similar to a borrower’s other options in that Reinstatement buys time to miss mortgage payments but then pay them in a lump sum at a later date.


Some borrowers simply choose sell their home rather than potentially face foreclosure and its repercussions, and then use the proceeds from the sale to pay back their home loan.

Short Sales

In a Short Sale, a lender agrees to allow a borrower to sell their home for less than what they owe on the mortgage and the servicer absorbs the loss. This is sometimes the option pursued when homes lose value, and while both sides take a hit, it is preferable to foreclosure.

Deed in Lieu of Foreclosure

With a Deed in Lieu of Foreclosure, a borrower transfers their deed to their home to the Lender in exchange for loan forgiveness, and then the lender is free to sell the home.

Contact Our Columbus, Ohio Foreclosure Avoidance & Defense Attorneys Today

If you have questions about your options when it comes to your home, do not wait to chat with an experienced attorney. Contact Kohl & Cook Law Firm, LLC today to obtain a free consultation and find out how we can help!



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