There are countless hardships that can turn home ownership from a joy into a burden. The loss of a job, medical bills, or an unexpected hike in monthly payments can all make a mortgage unaffordable. But ignoring the bills will not make them go away, it will only make things worse.
If you need help, there are approaches that can help, but you may not be familiar with them. One of these is a “short sale.”
In an approved short sale, the lender agrees to accept less than is owed for the property, and the homeowner is relieved of the debt. A lender may be willing to do this because it spares a lot of hassle and expense involved in executing a foreclosure. And typically, a short sale does far less damage to the homeowner’s credit than a foreclosure does.
If you would like to explore the possibility of a short sale for your property, please contact us ASAP and a qualified short sale agent will be in touch with helpful information. Sellers are advised to obtain legal advice regarding the advisability and terms of any short sale agreement with creditor(s) and professional tax advice regarding the tax implications of any such sale.
Six Strategies to Keeping your home
If you are interested in staying in your home or keeping your investment property. You can try these strategies:
- Refinance
- Pay off your loan
- Reinstatement
- Forbearance
- Loan Modification/Loan Work Out
- Chapter 13 Bankruptcy
Four Strategies to Give Up Your Home But Avoid Foreclosure
- Short Sale
- Sale with Equity
- Deed in Lieu Of Foreclosure
- Selling It On An Assumption - Beware of Scam Artists
There are many Do's & Don'ts but these are the basics:
Do:
- Be Leery of anyone who contacts you with a loan they promise will solve all of your troubles and save your home.
- Avoid high-pressure lenders, or those who encourage you to pay up-front fees for any service or loan; borrow more then the value of your home; or take on a loan without considering your ability to make the payments.
- Get all terms and promises in writing.
- Look out for terms that change or are not disclosed at the beginning of the loan process.
- Avoid any refinancing loan with inflated fees, a stiff prepayment penalty, an excessively high interest rate, or a balloon payment due.
- Check for complaints about any company that offers to buy your home: contact the MD consumer protection office for this information.
Don't:
- Don't sign anything unless you completely understand it; if you are unsure, have all all documents reviewed by an attorney or a trusted real estate professional.
- Don't deed your property over to anyone; signing your home over to someone else does not relieve you of your mortgage obligation.
- Don't let someone assume the loan without the lender's permission and without their formally releasing you from liability for the mortgage.
- Don't move out of your house because someone promises to make the mortgage payments for you.
- Don't list your home with a Realtor that is not experienced with short sales.
- Don't consider selling your home via a short sale (or any other sale for that matter) without determining its approximate market value. Haste may later cause you financial loss in the form of a 1099, deficiency judgement, or through other associated expenses. If you choose to sell using a short sale, it is best to sell through a qualified Realtor: using the Realtor that promises the quickest results is rarely in your best interest.
As a real estate professional who both lives and works in our area I feel it is my responsibility to provide information to the families who need it most right now. If you or someone you know is facing a financial crisis, call me now at (410) 814-2404 to help you determine the solutions and options that are available and point you in the right direction.
Click here for a summary of some of the solutions available to homeowners facing foreclosure. Please call us today for a free confidential evaluation of your individual situation, property value and possible options.