Threat of Foreclosure?
I am a Certified Short Sale and Pre-Foreclosure Specialist™. I have been trained to counsel you regarding your options other than foreclosure, and to communicate with your lender(s) to work out a solution.
First, you need to decide if you would like to either keep your home, or sell it.
If you would like to keep the home, you may be able to: (1) reinstate the loan by bringing delinquent amounts current; (2) work out a repayment plan with your lender to get caught up on the past-due balance; (3) have your loan modified, to possibly lower your interest rate, add the late payments to the end, or even extend the length of your loan; (4) persuade the lender to cooperate in a “forebearance,” where the lender postpones the foreclosure as long as you can cure the default within an agreed-upon time period; (5) be granted a Special Forebearance (HUD/FHA loans only) – could include a temporary suspension or reduction in payments; (6) a partial claim – lender may make an interest-free or low interest loan that would allow the borrower to postpone the past-due balance for several years, or until property is resold.
If you would like to be free of the home, your alternatives may include: (1) a conventional sale; (2) a Short Sale, where the lender agrees to accept less than what is actually owed on the home; (3) a Deed in Lieu of Foreclosure, whereby you deed the property bank to the lender; (4) a loan assumption – some lenders are starting to allow a third party to assume the loan, if that party is in a better position to make the payments rather than the current owner; or (5) temporary postponement (military only); or (6) file bankruptcy.
While no one knows the precise criteria used by credit bureaus to determine your FICO score, it is generally believed that a foreclosure will damage your FICO score by approximately 250 points, and will remain on your credit report for 10 years. A short sale, however, may only damage your credit by about 100 points, and you may be able to purchase a home much quicker than if you would have lost the home in foreclosure.
Click here to read Ray Martin from CBS' article regarding Short Sales
All lenders are different. They all have different rules that they must follow. I have been trained to work with them, determine what they can and cannot do, and work within those guidelines to resolve the situation for you. The bank does not want your house back. It is a loss for them, and it interferes with their ability to lend money – they are in the lending business, not the real estate business.
Please call me and we can discuss all of your alternatives in depth. 909.213.3304
