14 Options Every Home Owner Must Know When Faced With Foreclosure By: Scott MacDonald
Foreclosure is affecting millions of Americans today. It can be a very frightening time for many families who do not know how to handle this difficult process. If you are going through foreclosure, it is important that you are aware of all your options. We are here to help you take control of this issue and take back control of your life. Understanding your States Foreclosure Process In layman s terms, foreclosure happens when a lender tries to receive the rest of a loan amount from a borrower (or mortgagor) who stopped making payments. These lenders (or mortgagees) are usually banks, mortgage companies, and other financial institutions and companies who have some sort of monetary investment in a property. When a borrower defaults or, fails to comply with the mortgage, he is served with a lis penden. This is a notice given to the borrower that lets them know a law suit has been placed against them. Florida is a judicial state. This means that foreclosures are processed through the court. After a borrower is served a lis pendens, a court date will be set in order to determine what the total amount owed is. After the ruling is made, the residents of the house have a given period to vacate the property. After the residents have vacated the property, the house is eligible for auction. A sheriff s sale can now take place. This is when a house goes to the courthouse steps and is auctioned off to bidders. After all this takes place, states give a right of redemption period where the mortgagor can attempt to buy back his house. The entire foreclosure is a long and drawn out process. Luckily for homeowners, there are quicker and simpler alternatives to foreclosure.
For your convenience, I have included a foreclosure timeline which allows you to see the progression of the foreclosure process. There are different stages and steps to foreclosures. If you are interested in finding out what part of the process you are in, call our 24 hour hotline at- (904) 328-3211 Day 1 Day 16-Day 30 Day 45-Day 60 Day 90-Day 105 Day 105-Day 415 Day 415+ Foreclosure Timeline Borrower misses the first payment of the month A late fee is applied to the missed payment and the mortgagee attempts to make contact with the mortgagor. A letter is sent to the borrower letting him know that the terms have been broken. They have 30 days to fix the problem by paying off the amount owed. The loan is then passed off to a foreclosure department and then an attorney is hired to go through the foreclosure process. Court filings may also start being processed. The house is sold at an auction or sale. This can be anywhere from 105-415 days because state laws vary. Judicial states give more time, non-judicial give very little time. After the house has been sold, some states allow redemption periods. During this time, the mortgagor can purchase their house back if they have the money.
Foreclosure Time Clock This foreclosure time clock illustrates for you the stages of foreclosure in an organized manner. Start off at 12 o clock or late payment and make your way to 11 o clock or right of redemption. 12- Late Payment: If a payment is not made within thirty days of the due date, the payment is then considered missed. 1-Pre Pre Foreclosure: This is the period in which the bank waits for a late payment. 2- Foreclosure Starts: The bank has decided to foreclose and sends out the letter. 3- Pre foreclosure: The bank is beginning to take steps to foreclose. 4-Demand Letter: This is the first letter a homeowner receives to notify them of the pending problem.
5-Lis Pendens: The bank has now initiated foreclosure. Lis Pendens is Latin for pending suit. In other words, there is now a pending law suit on the property. 6-Complaint: A complaint in the official document filed by the bank with county courts that officially starts foreclosure. 7-Default: This is when the bank tries to get an order for foreclosure on the homeowner without having to go through the legal process of a trial. The majority of the time, courts grant this to banks. 8-Final Judgment: This is the final amount owed from the lender to the bank. This ties in court fees, banks fees, added interests, missed payments, and the remainder of the mortgage. 9-Auction: The property goes up for auction and is sold off to the highest bidder. 10-REO: REO stands for real estate owned. It is the term used when a house is not sold at auction and the bank then becomes the owner of the property. 11- Right of redemption: This is the period in which the homeowner can try to obtain their house back by paying off what they owe and then the banks attorney and court fees. It s very rare for people to get their house back. If you are interested in learning what stage of the foreclosure process you are currently at, contact us so that we can help you figure things out. It is imperative that you understand how little time you have and how pressing this problem is. There are three convenient ways to contact us. The first is my 24-hour hotline. That number is (904) 328-3211. If communicating online is easier for you, my email address is Scott@jaxhomebuy.com. If your situation is urgent, please don t hesitate to contact me on my personal cell phone- (904)226-2342. The time to call me is now! *Remember, we are not attorneys. Any legal action that you wish to take must be discussed with a lawyer beforehand. We are expert homebuyers who help individuals avoid foreclosure at all costs.
Options you have to stop foreclosure today: 1. Reinstate the loan 2. Working with your lender for forbearance 3. List the property with a realtor 4. Refinance the mortgage 5. Selling short (short sale) 6. Accepting a cash offer 7. Selling your house subject-to 8. Deed in lieu of foreclosure 9. Filing for bankruptcy 10. Mortgage modification 11. Waiting and doing nothing 12. Deed for lease 13. Rent the property 14. Service members Civil Relief Act (military personnel only) 1. Reinstate your loan You may have a right to reinstate or cure the default on your mortgage within a certain period of time after your default. The laws in your state specify the amount of time you have to pay the bank. Generally, in order to reinstate your mortgage, you must pay the entire amount due on the mortgage when you defaulted - missed payments, late fees, etc. Also, you'll have to pay the bank's costs and expenses in trying to enforce the foreclosure. These can get very expensive as you will have to pay thousands of dollars in court costs and attorney's fees for the bank. 2. Working with your lender for forbearance Forbearance is simply a special agreement between lender and the borrower to delay or postpone foreclosure. With this option, you and your mortgage company agree to temporarily suspend or reduce your monthly mortgage payments for a specific period of time. This option lets you deal with your short-term financial problems by giving you time to get back on your feet and bring your mortgage up-todate. Eligibility is a factor when asking for forbearance and the majority of the time, it only puts a band aid on a much larger problem.
3. List the property with a realtor Though realtors can be helpful during regular home sales, they are not ideal for a foreclosure situation. Realtors will list your house and try to get it sold to buyers before the foreclosure happens. However, in today s real estate economy, houses listed with realtors are usually spending in between 6 months and 1 year on the market before they are purchased. As you can see from the timeline above, you simply don t have that much time. Your realtor has, at most, 105 days to find a buyer and get the home sold. In today s market, those numbers are just not feasible. There are also commissions and closing fees involved that will eat up your equity and leave you with close to nothing. 4. Refinance your mortgage Refinancing a mortgage simply means getting a second mortgage to replace the one you already have. Refinancing lets homeowners lower payments and create fixed interest rates. The problem with refinancing is that very few homeowners actually qualify when experiencing foreclosure. If you already owe more than the house is worth, refinancing can be a waste of time because banks choose based on appraisals. If an appraisal is lower than what you owe, banks will not choose you for refinancing. Also, if a payment is already missed on the house, it has affected your credit and applying is futile. Banks are strict about credit scores when applying for refinancing. You are pulling more money out of your house. Payments may be lowered, but you end up paying much more in the long run. When refinancing, you have to stop foreclosure early enough in order for it to be helpful to you. 5. Short Sale A short sale is when you sell your loan short of the balance owed. Short sales have been around for a long time but it wasn t until recently that have they become popular. It makes sense that after the real estate boom we experienced in the mid 2000's, short sales would become one the most popular options for homeowners facing foreclosure. If you currently owe more than your house is worth and have experienced a hardship, then you may be eligible for a short sale.
The key to executing a successful short sale is to have a legitimate hardship that you can present to the bank. You cannot expect your lender to accept a short sale just because you owe more than your house is worth. If the bank does not feel that your reasons for missing payments are serious or severe enough, they will not approve you for a short sale. If you think you are eligible, call us today so that we can assist you. We can provide you with the information you need to know about short sales and process them quickly. Call us now at- (904) 328-3211. 6. Accepting a cash offer Cash offers are the most effective way to keep your credit intact and not pay any out-of-pocket expenses. The home is sold quickly and without hassle. You can get rid of the entire problem and move on with your life. Cash buyers will buy your equity at a discount so that you don t have to pay anything and foreclosure doesn t ruin your credit. Cash buyers can work with you personally without any fees and explain the process to you, step-by-step. Some buyers can close as quickly as 1 week. We personally pride ourselves in helping individuals going through foreclosure as quickly as possible and at their convenience. Do not let another day go by with the worry of a pending foreclosure. Today is the day to contact us to get the help you need. If you prefer to contact us virtually, my direct email address is- Scott@jaxhomebuy.com. 7. Selling your house subject to Selling your house subject-to is when you deed your property over to a buyer and that buyer makes the payments to the bank. It can be helpful if you have a buyer who is trust worthy and you are certain that they won t default. Scott was the epitome of professionalism throughout the entire process. I was leery initially because other businesses did not treat my elderly uncle with respect and honesty. Scott was very patient with my uncle who is 90 years old. I would recommend this company highly. -Christina Lundy Unfortunately, when you sell your house subject-to, the mortgage stays in your name. Think of it as buying a car for your son or daughter, and while it is in your name, they are making payments. In other words, if the buyer can t make payments, your credit is still affected. Many buyers are also not willing to pay the missed payments and interest that the seller has acquired.
8. Deed in lieu of foreclosure Deed in lieu of foreclosure is when you voluntarily give your house over to the bank. The bank then forgives the loan and promises not to foreclose or take any action in foreclosing. Much like a short sale, you must meet certain qualification for a deed in lieu of foreclosure. There is also a problem in that a lender may or may not forgive the deficiency balance on the house. This option is never very popular because it basically gives banks power over the home. 9. Filing for bankruptcy Bankruptcy is probably one of the most harmful things for homeowners. Your credit gets wrecked and you have to pay attorney and processing fees for the whole process. Bankruptcy affects every aspect of your financial status and situation, so think very carefully before you jump into filing. There are two kinds of bankruptcy: Chapter 7- This is the most common type of bankruptcy filed in the U.S. If you file for chapter 7, you are asking the bank to wipe out all your debt. Chapter 13- If you file for chapter 13, you are basically saying that you will pay some debts back in full and others will be paid only partially. You create a timeline and payment system so that you can pay off debt. Once again, we are not attorneys. But I have a network of attorneys that would love to help you if this is the decision you make. Contact us immediately at (904) 328-3211 for further information. 10. Mortgage modification Many homeowners hope for a mortgage modification, and rightfully so. It seems to be the best way for the owner to keep his house and avoid a huge blow to his credit. Mortgage modification basically modifies your loan or interest amount so that payments are lower. In 2011, the government stepped in and made adjustments to this process so that banks would be held accountable for their actions.
The issue arises in that not many people qualify for a mortgage modification. There is a great deal of requirements and rules that banks ask homeowners to follow in order to be considered and approved for a modification. Many people apply for a mortgage modification and spend a long time waiting, only to find out that they were denied and that their house will go into foreclosure anyway. Depending on the lender, there are different steps to follow to apply for a modification. Call us or email us today for further information. 11. Waiting and doing nothing Not taking action during a foreclosure is absolutely the last thing you want to do. Foreclosure will ruin your credit and pretty much disqualify you for any loans or new mortgages you apply for the next few years. We speak to plenty of people who are going through foreclosure, and we always have a good amount who decides to pretend that nothing is happening. Trust me when I say this, you are only hurting yourself more by allowing your house to foreclose. Don t become another statistic. We can and will help you stop this process quickly and easily. Call us immediately if you are going into foreclosure so that we can discuss your options. If your situation has progressed and you are short on time, don t hesitate to call my personal cell phone- (904)226-2342. I appreciate how professional and personable Scott was. I found his words and actions lined up and answered my many questions without being impatient. I highly recommend Premier Choice to anyone looking for help with their property in any capacity. Thank you so much Scott for making this transaction a success in every area. -Judy C 12. Deed for lease A deed for lease works somewhat like a deed in lieu of foreclosure. The difference is that homeowners can stay in their house as renters. The lender agrees to take off any liens. Though it allows borrowers to stay in the house, they are no longer the homeowners and will eventually leave when they want to buy a new house or need to find a more affordable rent. The same restrictions are placed on those applying for a deed for lease as those applying for deed in lieu of foreclosure. If you agree to do a deed for lease, it is important to understand that you are no longer the owner of the property and no longer have control over its future or any type of sale or income involved.
13. Rent the property Renting out a property is always a good option for those who are comfortable being landlords. If you can rent out the home for the same amount that you owe the bank monthly, then this could be a good option for you. On the other hand, the problems of being a landlord can become too stressful for many homeowners. Tenants will miss payments, damage the home, and often become more of an impediment to landlords. It is quite a big responsibility to take on. Though renting can be beneficial to a select few, it is not recommended to everyone. 14. Service Members Civil Relief Act (military personnel only) If you or your loved one is currently serving or about to serve in the military, the Service Members Civil Relief Act will put a stop to certain legal obligations. If you are in the military, this is a great alternative for you and your family. Now that you are aware of all your options, it is important that you weigh each one carefully and take action. The longer you wait, the worse the situation becomes, so it s important that you act as quickly possible. As a foreclosure specialist, I believe there is no better time to contact me than now. Here are three quick and easy ways you can contact me. The first one is my 24 hour hotline. Here, you can leave a message anytime of the day or night and I ll call you back ASAP. It is (904) 328-3211. If communicating online is easier for you, my email address is Scott@jaxhomebuy.com. If your situation is urgent, please don t hesitate to contact me on my personal cell phone- (904)226-2342. Everything we discuss will be completely confidential and we will get back to you with 24-48 hours. Call me so we can discuss how I can help you get this problem out of your life and renew your peace of mind.
Scott MacDonald has been helping people experiencing foreclosure for over 5 years. He works with individuals in all sorts of situations and from all walks of life. Fast, hassle free solutions are his specialty. His knowledge and experience have helped families avoid foreclosure and restore their peace of mind. For more information about Scott and what his company does, visit www.jaxhomebuy.com.