In my last blog post I mentioned the three "C’s" of dealing with a bank’s Loss Mitigator (Communication, Composure, Credibility). Now I’m going to take you into what may be surprising territory. Some people many not know the following are options when facing foreclosure, but they truly are.

Reinstating Your Mortgage, Like Nothing Ever Happened

Reinstating your mortgage consists of paying a lump some to cover all missed payments and any additional interest, fees, and penalties you’ve incurred as a result of the missed payments. After you reinstate your mortgage, it’s as if nothing ever happened — except for the fact that you may have another loan to pay off, if you had to borrow money to reinstate.

1. Digging up the cash required to reinstate

Reinstating your mortgage sounds like a great idea until you try to figure out how you’re going to come up with the money. Here’s a short list of possible sources for cash:

• Friends
• Relatives
• Bank loan
• Private lender
• Loan against your retirement nest egg
• Loan from your boss
• Assets — sell your stuff
• Loan against any inheritance you may receive

Sell something! If you never sold that vintage car you drove on your first date and you’re storing it in your barn, find out how much it’s worth and sell it. If it’s worth $50,000 and you could sell it quickly for $31,000, do it! After all, where will you store this beauty when they take the house away from you?

2. Borrowing against the equity in your home

Grab a calculator and figure out how much equity you have built up in your home. To do this, simply subtract the total amount you currently owe on the home from a reasonable price that you’re sure you could sell the home for in today’s market. If you end up with a positive number that’s more than a few thousand dollars, then borrowing against the equity of your home to reinstate the mortgage may make sense and be a realistic option.

3. Convincing your bank to reinstate your mortgage

Your bank is probably not exactly eager to offer the option of reinstating the mortgage. You’ve already missed payments or paid late, so your credibility is already in question. At this point, you have to reveal a solid plan and prove to the bank that, after reinstating, you can resume payments.

There is a great deal more I could go into on this subject but the namesake book for this blog really does cover it all. Check out  Foreclosure Self-Defense For Dummies and find the precise answers you need for your situation.

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