Avoid Foreclosure – What you need to know

foreclosure-house-up-for-sale

In the world of real estate, there are so many ins and outs that the average person would not know about. Real estate is our passion, so leave it up to the professionals to help.

If you are a homeowner facing financial difficulties, here are a few things to keep in mind.

1. Seek help – This is the first mistake many people make. If you are or will be facing a financial hardship, contact your lender and see what your options are available FIRST! Your lender may offer you an option to refinance, defer or modify your payments. Find out your options before it’s too late. There are several to choose from.

2. Communicate with a professional – Once you have decided what is the best situation for you, contact an experienced professional to assist with this process. IT IS FREE!

3. Short Sale your home –This is an option that a bank gives to a homeowner when they are in a hardship and want to sell the property but the value is not there. The property may be sold at less than what you owe on the existing mortgage.

You may be eligible for a Short Sale if you can answer “yes” to these questions:

  • Are you more than 29 days late on your payment, or are you in imminent danger of becoming late on your payment (based on your financial situation)?
  • Is your home worth less than what you owe on your mortgage?

Note: There may be other detailed eligibility requirements.

Depending upon your situation, you may need one or more of these documents:

  • Letter of Authorization (to speak with your real estate agent)
  • Listing agreement

You may also be asked for other documents such as tax returns, bank statements and income sources.

4. Deed in Lieu – If you cannot afford your mortgage payments, your lender may let you voluntarily hand over your house instead of going through a foreclosure. This is called a deed in lieu (DIL) of foreclosure. The lender agrees to cancel your loan in exchange for the deed to your house.

With a deed in lieu of foreclosure, the lender gets the title to your house and must sell the house to try to recover the unpaid debt. The lender agrees to forgive any unrecovered debt. **these are usually put on the market as an REO or HUD property for the public to purchase at a discounted price.

5. CASH for KEYS – If you are not prepared to save your home from foreclosure, and are ready to walk away, don’t walk away with nothing. Find an investor that is willing to offer you Cash for Keys for your home. They will offer you a small amount for the Deed to your home, catch up your mortgage and save your credit from foreclosure. If you go this route, you will be able to purchase another home whenever you are back on your feet.

These are a few steps will help you before it is too late. Although financial hardship can be embarrassing, it is important to tackle the issue before it becomes too late. Remember, your privacy is only yours before a public foreclosure is shared with the public.

Check out this article at HUD for more modification options: HUD

**Centric Real Estate Group participates in Cash for Keys. Contact us if you are facing hardship and need assistance.

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