4 Options to Avoid Foreclosure
It’s an unfortunate situation when you are facing foreclosure. You don’t want to lose your home. You don’t want to damage your credit score. You don’t want to hinder your ability to buy another house in the future. These are all the challenges in front of you when you are too far behind on mortgage payments. Foreclosure is something you should try to avoid at all costs.
Here are 4 ways you may be able to avoid foreclosure on your home:
1. Make Up Your Mortgage Payments
Foreclosure happens when you are too far behind on your mortgage payments. You have defaulted on your loan agreement. Therefore, the bank or lender will ultimately have the right to seize your property and sell it for fair market value to try and recoup what you owe them. The best way to avoid foreclosure is to keep up with your monthly mortgage payments. If you start to fall behind, do whatever it takes to catch up—or at least stay caught up enough to stay in the bank’s acceptable grace period and prevent the final foreclosure stages from happening.
2. Contact the Lender/Bank
Mortgage lenders and banks want to avoid foreclosures, as well. They typically stand to lose money on the deal and it’s a complex process with legal and real estate issues that need to be resolved. If you are falling behind on payments and worried about foreclosure, one of the best ideas is to simply be proactive about it. Contact your bank/lender and see what options may be available to you. They may be willing to work with you, especially if you are able to show proof of financial hardship (recently lost job, unexpected medical expenses, etc.). You may be able to go on a forbearance plan with delayed payments or some other financing program can be implemented to allow you to get caught up with your back payments over an extended period of time. You never know until you ask, so it may be worth a try.
3. Ask About a Short Sale Option
Short sales do not happen as much as they did during the real estate/mortgage crash of 2008. One big catch is that the bank will only agree to this solution if the property is worth less than what you still owe. This is rare in today’s market because home prices have been going up so consistently in recent years. Still, you may fall into this category and a short sale may be an option. It’s still not great for your credit score, but it is much less damaging to your than a foreclosure.
4. Sell Your House While You Can
If you are concerned that a foreclosure might be imminent because you are falling behind on mortgage payments—but you have yet to get any foreclosure notices/warnings from your bank—you may have the option to sell your house now. The real estate market is strong for sellers. You may be able to avoid foreclosure with a fast home sale. You might recoup some (or all) of what you owe on your mortgage, and maybe in a position to make a profit. A cash home sale is the quickest and easiest way to sell property. You may not have the time or money to hire a Realtor® and go through the “traditional” home selling process. Consider cash offers from real estate investors and home buying companies like PropertyLark. You can get a deal done quickly, getting you out from under the financial burden of your mortgage loan and allowing you to move on before the foreclosure process happens and your credit takes a major hit.
If you would like to avoid foreclosure and discuss your pre-foreclosure home selling options, contact PropertyLark today. To get started with a fair cash offer for your house, please fill out the contact form to the right. We’ll get back to you within 24 hours!