One of the worst experiences you can face as a homeowner is finding yourself in a financial situation that causes you to run late on payments. If you miss too many payments, you may find yourself underwater in your mortgage and facing foreclosure.
You may be relieved to learn that you have options for selling your home if you are facing foreclosure. At the Garnet Property Group, our goal is to help homeowners make fully-informed decisions based on facts – not emotion. If you are facing financial hardship or foreclosure proceedings, and are interested in selling your home facing foreclosure, follow this guide to help you move forward with hope!
Once you receive a notification from your home lender that your home is heading to foreclosure, it is time to act to prevent losing your home or damaging your credit score. In some cases, you may negotiate with your lender to develop a plan for keeping your home and catching up on your unpaid loan payments.
However, if you are unable to meet your lender’s requirements, you may need to move quickly to sell your home and regain the equity you have built. While you have options available to you when it comes to selling your home, it is vital to move quickly to avoid further foreclosure proceedings.
Foreclosure is the process of a bank or home mortgage lender taking control of your property due to the ongoing failure to submit payments on the loan you took out to buy the home. The foreclosure process differs depending on the state in which you live, but the final result is always the same: loss of property and any equity value you have in the home.
Typically, foreclosures begin around three to six months following the first failure to pay a mortgage payment. If a homeowner fails to contact their lender or pay, the lender will move into a foreclosure process. This will typically include notification of failure to pay increasing legal proceedings. You can learn more about the typical foreclosure timeline at the HUD website. If you fail to meet your lender’s expectations, your home may be taken by the lender and put up for sale at a foreclosure sale.
Due to increased payment options and the fallout of the 2008 housing crisis, homeowners have more options than ever to avoid foreclosure and keep their homes. The rate at which foreclosures finalize has continued to fall, with 2019 rates falling to 0.36% of houses as compared to 2.21% a decade earlier.
When it comes to avoiding foreclosure, the best option you may have is to sell your home and move on. However, once your home is in foreclosure, the process of selling your home becomes a bit more complicated. Often, your best chance to regain the best value on your home is to work with a property management group to gain a fast cash offer that allows you to pay off your lender and escape the stress of being behind on payments. Here is a short guide to the steps of selling your home to avoid foreclosure:
First, ensure that your lender knows that you are moving ahead with selling your home to cover the missed payments and avoid foreclosure. Often, your lender will work with you if you show evidence you are actively seeking a solution. Depending on how far into the foreclosure process you are, you may need the lender’s permission to move forward.
Once you have lender approval to move forward with selling your home, it may be beneficial to contact a real estate agent or property buyer to move forward with your sale. A licensed agent or property buyer can help you sell you home quickly due to your current financial situation. In some cases, you may be able to avoid closing costs!
One of the best options at your disposal may be to accept a cash sale on your property. There are various reasons to consider selling to an investment property buyer, including the ability to avoid closing costs and successfully close on your sale within two weeks. To learn more about the cash-offer process, contact the Garnet Property Group.
Once you gain a buyer for your property, ensure that you work closely with your lender to avoid unexpected issues. You may need to file a deficiency judgment to avoid being held liable to the amount leftover on the loan that the sale was unable to cover.
No matter the situation, keep a friendly rapport with your lender to ensure that you are well aware of their expectation moving forward. With any luck, you should find yourself free of the chains of foreclosure and ready to move forward with as little damage to your credit score and finances as necessary!
While selling your home is a great way to avoid foreclosure, there are various other options available to homeowners to help them keep their homes and escape the cloud of uncertainty that foreclosure can bring.
It may seem obvious, but this tip is always worth reiterating: the best way to avoid foreclosure is to bring your monthly payments up to date and ensure that you are in good standing with your lender. Rather than assume that you are up to date, contact your lender and work with them to develop a plan for moving forward that avoids falling back into another foreclosure situation.
Few homeowners realize that many banks, lenders, and HUD offer alternative payment options that may help you ensure that you keep current while paying less for a temporary season. Loan modification programs such as the Principal Reduction Alternative (PRA) and Making Home Affordable © (MHA) Program are designed to help homeowners find options for affording their mortgage payments and stay in their homes. Head online to HUD’s website to find a full set of resources to help you navigate your options and begin the process.
Another method to avoid foreclosure is to work out a short sale option with your lender. In a short sale, the homeowner typically reaches out to their lender because their amount is larger than the home’s value.
The short sale process initiates a sale where the homeowner works with a realtor to sell their home and convinces the lender to accept the lower sale price to release them from the loan amount due. This process will help homeowners get out from an underwater mortgage and rid themselves of a home they cannot afford. The lender will end up “short” on the amount of sale price they receive from you, but often lenders will choose this over receiving nothing at all.
If you would like to learn more about the short sale process, the Garnet Property Group team would love to chat with you about your options!
The most important thing to remember in a foreclosure situation is that you are not alone. There are various resources available to help homeowners rise above their foreclosure situation and find hope for regaining their financial independence and protecting their futures.
Whether you are considering selling your home with a fast-cash offer or considering the various options available to help you avoid ever-increasing payments, the Garnet Property Group is ready to step in and help you recover from your financial stress. You have options when it comes to protecting your family and your property from the unexpected and the overwhelming. Contact the Garnet Property Group today to learn more about the options available for homes facing foreclosure.