What to Do When Your Home Is Up For Foreclosure


Mortgage, Real Estate / Monday, September 24th, 2018

You have been living in your home for so long you are attached to it. It’s hard to imagine your family moving out. Foreclosures are, however, not easy to stop. But how can you tell it’s time to surrender your home to foreclosure? You need to consider the following conditions:

  • Are you having problems making your monthly mortgage payments? If that is the case, you may not want to remain in your home, given the economic costs.
  • Is it possible for you to sell your home as a short sale on the open market? In other words, are your payments for the mortgage much more than what you would pay renting a similar home?
  • Considering your projected income and expenses it is unlikely that the bank will be in a position to collect the foreclosure balance anytime soon.

You need to talk to an attorney if one or any of the conditions above apply to you. Make active responses at every stage of the foreclosure to save yourself a lot of time and money.

Employing Your Leverage

It is possible that you will not be able to pay the amount of money in a deficiency judgment for the mortgage balance. The lawyer should negotiate with the lender an anti-deficiency agreement on your behalf. If that is the case, the mortgage company will have no issue granting friendlier terms of mortgage surrender. Foreclosure litigation can drag on for a long time. Most lenders don’t like waiting forever. That’s why the bank is likely to give up the right to collect against you.

Banks have no problem opting for a short sale since that means a lot of work being done for them free of charge. It is a financial disaster for you if you allow the foreclosure to drag on without representation by a lawyer. Who knows? You might just be sued for the mortgage balance sooner than you expect. Talk to a lawyer to represent you throughout the process of the foreclosure and you can be sure of protection. 6 Signs it’s Time to Sell Your Home

Moving To a New Home

Don’t hold onto your home if it’s facing a foreclosure. It might not just be worth what you are paying for it. Choose to look at it as a blessing in disguise. It is possible that you have equity and can still afford the mortgage. Ask the lawyer to help you go after an open market sale or loan modification.

If you can no longer afford the mortgage, the lawyer will advise you to think about surrendering during foreclosure, if that is the right step to take financially. How will that affect your future financial outlook? In just about three years, it is possible you will qualify for another mortgage. With time, you will find a house that best suits your current means and needs. As you wait for another mortgage, you can take time to save for the down payment.

Don’t be afraid of going through the foreclosure process. It might just be the beginning of you getting a new and better home.

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