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There are roughly ten ways to stop or resolve a foreclosure in Maryland. Most of them keep you in the house. This page ranks them by how much of your home’s value you walk away with, which is a different ranking than most sites give you, because most sites rank by how easy the route is for them.
Before the list, the two facts that change everything. Free foreclosure counseling exists in Maryland at no cost to you: the state referral line is 877-462-7555, and the national HUD directory is at hud.gov/findacounselor or 800-569-4287. And under Md. Real Property 7-105.1, you can cure the default and reinstate the loan at any time up to one business day before the foreclosure sale occurs. Late is not the same as over.
The ranking, and what it is ranking
Value kept means what stays with you: equity, credit standing, and whether the debt follows you afterward. Not every route is available at every stage, so read the timing column alongside the ranking. The Maryland foreclosure timeline shows where each stage falls.
| Route | Value you keep | Keeps the house | Still available how late |
|---|---|---|---|
| Reinstatement | All of it | Yes | Up to 1 business day before the sale |
| Repayment plan | All of it | Yes | Best before a sale date is set |
| Loan modification | All of it | Yes | Complete application 37+ days before sale |
| Forbearance | All of it, deferred | Yes | Early stages |
| Refinance | Most of it | Yes | Before credit damage is severe |
| Chapter 13 bankruptcy | Most of it | Often | Filing stays a scheduled sale |
| Selling with equity | Your equity, in cash | No | Until the sale, subject to payoff timing |
| Short sale | Little, but avoids the auction | No | Needs months of lead time |
| Deed in lieu | Little | No | Needs lender agreement |
| Letting it go to auction | Least | No | Default outcome |
1. Reinstatement, the cheapest exit that exists
Pay everything past due plus fees and costs, and the loan returns to normal. Nothing else on this list preserves as much.
Md. Real Property 7-105.1 also requires the lender, on request, to provide within a reasonable time the amount necessary to cure the default and instructions for delivering the payment. Ask for that in writing even if you are not sure you can raise it. Every other decision here gets easier once you know the number.
Where the money comes from is usually back pay, a settlement, a retirement account, or family. It is worth asking family before it is worth asking a hard money lender.
2. Repayment plan
The servicer spreads the arrears across your next several payments. No lump sum, no lender underwriting of a new loan, and your payment goes up temporarily.
This is the right answer when your income has already recovered and the only problem is the hole. It is the wrong answer when the payment was never affordable, because a temporarily higher payment does not fix that.
3. Loan modification
The servicer permanently changes the terms: rate, term, principal, or the arrears get capitalized back into the balance. For most households in real hardship, this is the target.
The mechanics are federal. Under 12 CFR 1024.41, if the servicer receives a complete loss mitigation application more than 37 days before a scheduled foreclosure sale, it must evaluate you for all available options and notify you in writing within 30 days. It must acknowledge your application within five business days and tell you whether it is complete. And you generally get 14 days to appeal certain denials.
Complete is the operative word. Incomplete applications are the most common reason people lose a modification they would have qualified for. A free HUD approved counselor will assemble the package with you, which is exactly the kind of unglamorous help that changes outcomes.
4. Forbearance
Payments pause or shrink for a defined period. Forbearance does not erase the missed amount. At the end, you and the servicer agree on how it gets handled, whether that is a lump sum, a repayment plan, a deferral to the end of the loan, or a modification.
Ask what the exit looks like before you accept, and get it in writing. Forbearance with an unknown exit is just a delay.
5. Partial claim, deferral, or advance
Depending on who backs your loan, the arrears may be moved into a separate zero interest lien that is not due until you sell or refinance. FHA, VA, USDA, Fannie Mae and Freddie Mac each have a version of this.
You need to know who owns your note to know which applies. A counselor can find that out with you at no cost.
6. Refinance
A new loan pays off the old one. This works cleanly if you have equity and your credit has not yet taken serious damage. Once you are several months delinquent, refinance options narrow quickly and get expensive.
If a lender offers you a refinance with terms you cannot follow, that is not a rescue. Have someone else read the terms.
7. Chapter 13 bankruptcy
Filing triggers an automatic stay that halts a scheduled foreclosure sale. Chapter 13 then lets you cure the arrears over a court approved repayment plan while keeping the home, which the federal judiciary explains in Chapter 13 Bankruptcy Basics. Chapter 7 generally delays a foreclosure rather than curing it.
This requires an attorney and it requires steady income. For a household that can afford the regular payment but cannot catch up the arrears, it is often the strongest option on this page. Do not let anyone talk you out of asking a bankruptcy attorney, including a cash buyer.
8. Selling while you still have equity
If the house is worth more than the payoff, selling turns that difference into money in your hands. A foreclosure auction is not built to get you a good price. It is built to satisfy a debt, and whatever is left over after costs is what you get, if anything is left over.
You can sell during a foreclosure. The constraint is timing: the deal has to close and the payoff has to reach the lender before the sale, or the trustee has to agree to postpone. Selling a house that is already in foreclosure covers the mechanics, and whether a sale actually stops the foreclosure covers the part people worry about.
A conventional listing is usually the highest price if you have the time and the house shows well. A cash sale is usually the highest certainty when the calendar is tight or the house needs work you cannot fund. Comparing a cash offer against listing with an agent lays out where the money actually goes in each.
9. Short sale
The house sells for less than the balance and the lender agrees to release the lien. It avoids the auction and it can be gentler on your record than a completed foreclosure.
The catch is lead time. Short sale approval takes the servicer weeks to months, and a sale date on the calendar does not care. Two things to get in writing before you sign anything: whether the lender waives the deficiency, and how the forgiven balance will be reported.
Forgiven debt can be taxable income. The IRS covers this in Topic 431 and Publication 4681. There has historically been an exclusion for qualified principal residence debt, and there is a separate insolvency exclusion that many households qualify for. Talk to a licensed tax professional before you agree to a short sale.
If your balance is higher than the value, start with what to do when you owe more than the house is worth.
10. Deed in lieu of foreclosure
You transfer the deed to the lender and the foreclosure ends. Lenders frequently refuse when other liens sit on the property, since they would take it subject to those liens. Ask about relocation assistance, because some servicers offer it and very few mention it unprompted.
Maryland’s mediation, which is genuinely worth using
Maryland gives owner occupants something most states do not: a scheduled session with the lender in front of an administrative law judge.
Maryland Courts explain that when the lender files a Final Loss Mitigation Affidavit, it must send you a Request for Foreclosure Mediation form, and that you have 25 days from receiving that form to file the request with the circuit court along with a non-refundable $50 fee. A judge can waive or reduce the fee using the Request for Waiver of Filing Fee for Foreclosure Mediation form.
Three things to know. Maryland Courts state this is the only time mediation will be offered, so the 25 day window does not come back. Only owner occupied principal residences qualify. And once you file, the Maryland Office of Administrative Hearings will schedule the session within 60 days of receiving the request.
Bring a completed loss mitigation package, pay stubs, and a proposal you can actually afford. A counselor will help you build that for free.
Baltimore City resources specifically
The Baltimore City Department of Housing and Community Development lists homeowner programs on its resources for homeowners page, including emergency mortgage and housing assistance, a tax sale deferral program that can remove an eligible property from the tax sale list, and home repair programs. Intake runs through the LIGHT unit at 410-396-3023. Individual programs open and close as funding allows, so ask about current availability rather than assuming either way.
The Maryland Department of Housing and Community Development runs the HOPE initiative and states that foreclosure prevention counseling is free for Maryland homeowners, with referrals at 877-462-7555. Maryland Legal Aid and the Pro Bono Resource Center of Maryland both handle foreclosure matters for eligible homeowners in Baltimore City.
If property taxes are part of the picture, tax sale is a separate track with its own clock. The Baltimore tax sale process explains it.
How to tell real help from the other kind
Legitimate counseling is free. Nobody who is actually helping you needs money up front to save your home, needs the deed signed over as a condition of assistance, or tells you to stop communicating with your servicer. Same day signature pressure is a red flag regardless of who is applying it.
Our own position on this is on the record. Bring us a written offer from another buyer and we will beat it or we will tell you to take it. If you want the uncomfortable version of the question, is we buy houses a scam is our honest answer.
What to do this week
Call 877-462-7555 or use hud.gov/findacounselor and get a free counselor. Ask the servicer in writing for the reinstatement amount and the full payoff. Then find out what the house is worth today, because the gap between those two numbers decides which half of this page applies to you.
Our valuation tool returns a real number in minutes, free, with no obligation and no phone call required. Use it as information whether or not you ever want to sell. The rest of the picture is on the Baltimore foreclosure hub, and if you are earlier in this than you think, what happens as you fall behind on mortgage payments is the better starting point.
Before you act on this
This page is general information about how these processes work in Maryland. It is not
legal, tax, or financial advice, and your situation may turn on details this page cannot
know. Talk to a Maryland attorney or a licensed tax professional before you make a decision
you cannot reverse. If you are facing foreclosure, you can also speak with a HUD approved
housing counselor at no cost.
Questions people ask
What is the cheapest way to stop a foreclosure?
Reinstatement. You pay everything past due plus fees and costs, and the loan returns to normal. Md. Real Property 7-105.1 allows this up to one business day before the sale, and requires the lender to tell you the exact cure amount on request. Nothing else preserves as much.
How does Maryland foreclosure mediation work?
If the property is your principal residence, the Final Loss Mitigation Affidavit comes with a mediation request form. Maryland Courts state you have 25 days to file it with the circuit court plus a $50 fee, which a judge can waive. The Office of Administrative Hearings then schedules the session within 60 days.
Will filing bankruptcy stop a foreclosure sale?
Filing triggers an automatic stay that halts a scheduled sale. Chapter 13 then lets you cure the arrears over a court approved plan while keeping the home, as the federal courts describe in Chapter 13 Bankruptcy Basics. Chapter 7 generally delays rather than cures. Talk to a bankruptcy attorney before deciding.
Is a short sale better than letting it go to auction?
Often, but it needs lead time that a scheduled sale date may not allow. Get two things in writing first: whether the lender waives the deficiency, and how the forgiven balance will be reported. Forgiven debt can be taxable income, so ask a licensed tax professional about your year.
What help is available in Baltimore City specifically?
Baltimore City DHCD lists homeowner programs including emergency mortgage and housing assistance and a tax sale deferral program, with intake at 410-396-3023. Statewide, DHCD's HOPE initiative offers free foreclosure counseling at 877-462-7555. Maryland Legal Aid and the Pro Bono Resource Center handle foreclosure matters for eligible homeowners.