If your adjustable rate mortgage has recently reset and your monthly payments have gone so high you can't afford them, you may find yourself desperately trying to hang on to a property that's no longer worth what you paid for it. So, if want to avoid foreclosure, what's next? The answer is a short sale. To learn how to avoid foreclosure with short sales and the answer to some commonly asked questions,
WHAT ARE SHORT SALES ?
Short sales are a deal between the lender and the borrower to sell the property for less than the amount that is owed on the mortgage. Essentially, the lender accepts less than the total debt to avoid foreclosure processing and expenses.
WHAT ARE THE BENEFITS OF SHORT SALES ?
For the borrower, or homeowner, these deals mean they can avoid foreclosure with short sales, meaning they can sidestep irreparable damage to their credit report. According to the National Short Sale Center, a foreclosure can stay on your credit history for as long as 10 years, making it difficult to purchase a new home or obtain credit.
WHAT ARE THE REPERCUSSIONS OF DOING A SHORT SALE ?
This depends on your lender and how they handle short sales. However, a experienced Realtor can try to aggressively negotiate on your behalf. I will try to negotiate with your lender for a release of their lien as payment in full without the lender's seeking a deficiency judgement against you. I can explain this in detail in a free, no pressure consultation.
HOW LONG WILL THE BANK LET ME GO WITHOUT PAYING PAYMENTS BEFORE THEY START FORECLOSING ?
90 days until they file a notice of default, and another 120 days until they proceed to a foreclosure auction.
WHAT IS A NOTICE OF DEFAULT ?
This is a document that is recorded with the County Recorder's office by a trustee and formally starts the Utah foreclosure process. A copy of Notice of Default is usually mailed out to the defaulting party.
WHAT IS A NOTICE OF TRUSTEE SALE ?
This is a document that is recorded with the County Recorder's office and placed on the property which states the date, time and location of the scheduled sale of the property.
WHAT ARE MY OPTIONS IF THE BANK STARTS FORECLOSING ON MY HOME ?
1. You can start making mortgage payments again and reinstate the loan. This may be able to be accomplished through talking to the bank. Often you may need an expert's help. Please feel free to contact me.
2. You can do a pre-foreclosure sale. If you have some equity in your home and you can sell your home in the correct time line, you can pay your loan in full and not have a foreclosure on your record. You may have a negative score due to being late. It depends on the lender. This is a great option if your house is currently worth more than what you owe. Generally, you are responsible for paying commissions and closing costs.
3. You can have an experienced agent (not all are) represent you in the short sale process. If approved the bank pays commissions, closing costs. Depending on the bank and a skilled agent you can try to get a deficiency judgment and not have to pay back the amount that is short.
4. You can try to get a "Deed in Lieu of Foreclosure" Depending on many factors the bank may not be willing to grant this request. It costs the lender money to do this option and in most cases the Bank trys to collect as much as they can to repay your loan. I can help you through this process.
5. Some people walk away. This is not a good option. This will cost you your credit and alot of money. I would recommend trying other options.
There are alot of things you can do to not let the foreclosure process progress until the very end. Good luck and do not hesitate to call.
Call Natalie Larsen at (801) 458-7215 or email her at : Mail@NatalieLarsen.com web: www.NatalieLarsen.com
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