If you aren’t familiar with the concept of bank foreclosure then let’s shed some light on some of the legal terminology involved in the matter:

1) Refinance is the term given to the situation that occurs when lenders give borrowers extra money to pay off debts already incurred. Thus a home can be refinanced to pay off credit card debt etc. The creditor would take legal possession of a set percentage of the property in this situation (until the borrower repaid the debt). This option is particularly useful to people that have an unexpected bad turn in their finances and helps them to recover. If the person doesn’t already own around twenty percent of the property, lenders are unlikely to offer refinance deals.

2) Forbearance is a legal situation that defines the relationship between borrowers and lenders and re-establishes delinquent loans when the owner of the home pays a specified amount of the outstanding debt as a lump sum payment. The rest is paid over time. In effect it is a lifeline that re-establishes the loan as it was. » Read more: Understanding Bank Foreclosure Terminology