My yard is on a slope from the woods behind my house. And when it rains the water flows down the hill beside the house and has washed out all the grass i the front yard. What do I need to do to fix this? Please help it's a muddy mess.
It sounds like you already know what to do, reroute the water.
You can regrade to not have the water go through your yard, or you can install drainage.
Is this a new house with a new lawn? It sounds like the grass hasn't had a chance to get a good root system established. It also might be due to the type of grass that you are using.
If this was a new lawn, was it sod?
Since you get most of your rain in winter, I would suggest that in about a month, overseed the lawn with an annual ryegrass, aka winter rye. You can get a 25 or 50# bag at your local hardware store, sometimes even at Walmart fairly inexpensive. Use the whole bag so you get a real thick carpet of grass real quick. Rye has deep roots and will help hold the soil in place until spring. In the spring, you can reseed or sod with your desired grass, but use plenty of fertilizer so that it develops deep roots fast.
Look into terraced landscaping, not grass.