Are You In Trouble With Your Mortgage?
What is your first step?
The first step you have to take is to completely understand the foreclosure time frame so that you can properly plan how you are going to deal with your situation.
#1 – The foreclosure process starts when a “Notice of Default” is filed. At this point you have 90 days until the next step.
#2 – After 90 days, the “Notice of Trustee Sale” is filed. At this point you have 21 days until the “Trustee Sale”.
#3 – The “Trustee Sale” occurs and your property is sold at auction or taken over by the lender.
The total process takes a total of 111 days from the day the “Notice of Default” is filed on your property. Lenders vary on what point they will initiate a Notice of Default, but the average is about 3 months. So if you have missed your mortgage for 3 months in a row you raise the possibility that a Notice of Default will be filed.
And be aware that when the Notice of Default is filed, the foreclosure process has started. Here is an example to illustrate the point:
If a Notice of Default is filed on March 1st, then the final foreclosure sale will be June 22nd (90 days + 21days). Plan your time and understand where you are in the process.
What are your options?
If you are behind on a payments or are already in the process of foreclosure then here are your 3 options:
- Loan Modification – This is when you negotiate with your lender on the terms of your loan to restructure a payment plan (Loan Balance, Interest Rate, Terms, etc)
- Short Sale – This is when you get approval from your bank to sale your home at the market value, even if your loan balance is higher than what your home is worth.
- Foreclosure – You don’t do anything and let the bank take back your property. This negatively affects your credit for years
Why a short sale might be best for you.
A short sale is a win-win solution for the home owner and the lender. Borrowers get relieved from their mortgage debt and get their credit restored.
What are the benefits of a short sale?
When a short sale is achieved, there will not be a foreclosure. A foreclosure damages credit up to 7 years and bankruptcy up to 10 years. Many experts believe that a foreclosure is much worse than a bankruptcy. Plus, you do not have to come out of pocket to pay for these services!
Let Our Team Negotiate With Your Lender For You!
Short Sale FAQ's
How much will a short sale cost me?
Nothing! In almost all cases you will pay no sales costs if your short sale is approved by your lender (this includes all commissions, title and escrow fees).
Why would my lender agree to accept a short sale?
There are two primary reasons. First, due to asset manager expenses. It is expensive for lenders to own real estate (this is not their goal). Secondly, lenders have to deal with reserve requirements for non-performing loans. This requires them to set aside a lot of funds to deal with the issue.
If I have 2 loans can I still do a short sale?
Yes, we can work with both of your lenders. This is possible because neither lender is looking to own a home through foreclosure.
