Is it best to try to sell my home before accepting foreclosure?
Luckily for those behind on their mortgage, there are many alternatives to foreclosure. While accepting foreclosure is almost always the last resort for both homeowners and lenders, to determine which alternative is “best” depends on the individual’s specific situation. Some homeowners’ priority is simply staying in their home at all costs, while others prioritize recovering from the overwhelming debt of their mortgage. Because foreclosure is generally not ideal for either party, there are many options that lenders and homeowners can agree to in order to resolve the defaulted mortgage.
A homeowner becomes “in foreclosure” from the point they receive a Notice of Default from their lender. However, this doesn’t mean your home has already “been foreclosed.” The process of pre-foreclosure and foreclosure can take months or even years before the property is sold. At any point throughout the foreclosure process, up until the actual auction & sale of the home, the homeowner has the option and the right to sell their home and use the profits to recoup their mortgage debt. However, in order to escape the foreclosure, the homeowner will either need to make a deal with the lender, or ultimately pay the entire balance – including penalties, fees, and back payments – in full.
One home sale option that desperate lenders will sometimes agree to is, a short sale. In this situation, the home is sold for less than what is owed by the current homeowner, and yet the lender agrees to resolve the debt at that price. While the lender is accepting less than what was owed, they generally lose less compared to the costs involved with foreclosure proceedings, and auctioning the home.
In some individual’s best-case scenario, a homeowner can sell their home for enough to pay off the entire amount owed and avoid the final foreclosure, as well as the negative affects the foreclosure has on their credit.
If selling your home is not ideal, you can negotiate with your lender for other options such as loan modifications or forbearance. A detailed explanation of foreclosure alternatives can be found here.
If you’re in foreclosure, pre-foreclosure, or simply worried about making your next mortgage payment, speak to an experienced foreclosure defense attorney as early as possible. The earlier you act, the more options you will have available. An experienced foreclosure defense attorney can help to explain all your options and help entice the lender to work with you in avoiding foreclosure. Contact our office today to set up a meeting with our experienced foreclosure defense attorneys to go through your situation at length. Our office can be reached at (702) 998-1188, firstname.lastname@example.org, or by scheduling a consultation online.