How to keep your home from going to foreclosure
I get this question from many consumers on a daily basis – I am facing foreclosure, what do I do?
In today’s times this is something that is very common and affects millions of Americans; if you are in this position you certainly are not alone! You now have many options to avoid foreclosure and with the number of options that are out there you should never just let your home go to foreclosure. Letting your home go to foreclosure can have serious ramifications financially and on your credit. The good news is there are many programs, some government-backed, that can help you avoid going into foreclosure.
The most important part of this process is to not wait or ignore the issue! The longer you wait, the harder it becomes to get any assistance from the lender or the servicer; the quicker you take action the better chance you have of getting a positive result.
If you are in a situation where you are facing foreclosure the very first step you should take is to reach out to a professional, depending on what you are looking to do, that represents you and not the bank. Make sure you research the company or professional you reach out to, as there are many scams out there when it comes to seeking help in this situation.
One of the options you may have is applying for a loan modification. The best person to reach out to when it comes to a loan modification is a non-profit housing counseling agency. They can go through the process with you and talk to the bank on your behalf; they are trained on the process and can help advise you on what path to take. Their service is free, as you should never have to pay for help in this situation and in some states like Maryland it is illegal to charge the homeowner. Please be advised that if you want to apply for a loan modification you have to have income that supports being able to pay the modified amount. There are tons of programs that are out there, but be advised that you will be required to provide income documents to the bank which the HUD counselor can help you with. If you need a major loan modification, that may not be possible with all lenders and servicers and you may have to seek other options.
If you have equity in your property meaning it is worth more than what you paid for it, and you are having trouble making the payments, you can sell the property and retain part of your equity. If there is not equity in the property and you feel you need to sell then a short sale should be considered next.
The next best option may be a short sale. If you pursue the option of short sale it is very important you reach out to an agent that is qualified and has significant short sale experience as these transactions are very complicated and you need an experienced agent to help you. A short sale is where the bank will work with you so you can sell the property for less than what you owe on it in order to avoid foreclosure. A short sale has many benefits and all the banks and investors have streamlined the process to help consumers get through the process faster. Here are a few benefits of a short sale:
- There are programs available to put money in your pocket to participate in a short sale; sometimes up to $35,000.
- Banks are more willing than ever to participate in short sales.
- Almost anyone can qualify if there is a financial hardship involved.
- Short sales are not as difficult and cumbersome as the media portrays them when handled by a professional.
- Short sales are very common and affect millions of homeowners across the country.
- There has never been a better time to participate in one of the several short sale programs available.
- Short sales can alleviate a huge financial burden.
- A short sale can relieve you of debt you could otherwise be stuck with if let your property go to foreclosure
IF you need help or more information on short sales check out my site at www.easternshorehomesolutions.comfor more information.
If these two options do not work you could also go through a deed in lieu of foreclosure. This is where you agree to give the deed over to the bank in exchange for them not going through with the foreclosure on your property. If this is the option you choose, it is very important you work with a qualified attorney to draft up the agreement or review the agreement from the bank to protect your best interest.
These are just a few of the many options if you are in a situation where you are facing foreclosure, but I cannot stress enough that if you are in this situation, DO NOT WAIT. The longer you wait the worse the outcome becomes, the quicker you act the more the bank will be willing to work with you. There are many programs that can help you, and no one should ever have to go through foreclosure, act before it is too late and you will be in a much better position for the short and long term.