FORECLOSURE OPTIONS

If the issue that caused you (The Home Owner) to miss payments was temporary and you are not able to make a one time reinstatement payment. The lender may be able to negotiate a forbearance or Repayment plan. If you do not have the means to repay all of the missed payments and legal fees, the other option is that the lender will allow you to repay the missed payments at the end of the scheduled loan amortization. However it is more likely that you will be given a period of time in which to repay the delinquencies.

FOREBEARANCE (There Is A Catch) Typically a mortgage is not fully reinstated through a forbearance plan until all the payments are made in full. If you miss one payment even by a day you can end up at the same stage of the Foreclosure process that you were in previously.

In some cases homeowners facing Foreclosure will have payments low enough to allow them to rent their property and keep up the mortgage payments. This is however in my opinion a Short Term solution, since when Taxes/Insurance/ Maintenance Payments come due, many homeowners cannot afford them. This will force the mortgage company to enforce an escrow account on the property. This of course will make mortgage payments go up . It is quite possible to then finish up in the same situation they were in before they rented the property.

If the homeowner has sufficient equity and income and their credit has not been too badly damaged they may be able to refinance. This is a short term solution since the payments will go up considerably due to the refinance. Again if the issue that caused the homeowner to be late in the first instance has been rectified this may work, but in most cases it is just a FORECLOSURE WAITING TO HAPPEN.

This relatively new phenomenon shows just how far some mortgage companies and lenders are going to avoid foreclosure. This process involves the refinance of a home with a reduction of the principle balance and often interest as well. The borrower will have to qualify for this process by proving hardship as well as the ability to pay the new mortgage, often through a fully documented qualification process.

SHORT REFI ( There is a Big Catch ) Any profit on selling the property at a later date will go to the lender). Yes, even if sold 20 years later!!!!!

Sometimes referred to as a ?Friendly Foreclosure? since the home owner simply gives the deed back to the bank. This prevents the banks having to go through the lengthy and costly foreclosure process. This solution only happens if there are no liens (or very small liens ) on the property.

Bankruptcy may stop a Foreclosure and allow a homeowner, to reorganize their debt and keep their property. Most of the time however this only stalls FORECLOSURE.

When a homeowner owes more on the property than it is currently worth and can prove hardship. In the past it was rare that a bank or lender accept a Short Sale. However due to overwhelming market changes in the past few years, lenders have become much more open to negotiations, when it comes to these transactions. A homeowner is ?short? when a borrower owes an amount on their property, that when combined with closing costs and commissions is higher than the market value.

A Short Sale occurs when negotiations are entered into with the borrowers mortgage company or companies to accept less than the full balance of the loan at closing. A buyer purchases the property and closes on the property and the property is ?Sold Short?

A Short Sale also allows you to repair your credit within a year or so, with the possibility of purchasing property in the near future.

Prepared By Dennis Pugsley..

CERTIFIED DISTRESSED PROPERTY EXPERT Saving One Family At A Time From Foreclosure

The Real Estate Company Treasure Coast Inc