The options available at the time of pre-collateral foreclosure depend on your specific circumstances and are different in each case. As the timeline gets closer to the auction date and/or letters sent by bank/collateral companies and lawyers are ignored, the available options become more and more limited.
1. The best option: recover the loan. Also called treatment. This option is for the lender to pay everything in one time. This includes any missed payments, all late fees, cancellation of redemption fees, legal and attorney fees, and principal owed during arrears. The cure may involve the seller's cure, handing it over to investors "submitted" to withdraw the loan and they will be cured. Unfortunately, we found that this option does not apply to most people if there is no change in job status or you can find funds through 401K, annuities, CDs, or relatives.
2. Repayment plan: negotiate a written agreement between the lender and the borrower (homeowner). Typically, these plans require a higher-than-normal monthly mortgage payment over a period of time until the loan is updated. Applicable to people whose income allows higher payments.
3. Loan Modification: Loan modification involves changing one or more mortgage terms to meet your financial condition. Types of loan modification include lowering mortgage rates, moving mortgage products (from adjustable rate mortgages to fixed-rate loans or interest-only mortgages), extending mortgage terms and/or adding arrears to mortgage balances. Modifications are not easy to grant, and there must be strong and reasonable reasons for the request. The loan modification process may take 45-60 days to complete.
4. Tolerance agreement: The lender will allow you to pay low or no payment for a period of time (usually 3-6 months). We usually see that lenders can tolerate when temporary unemployment or family tragedies occur. If the lender does not extend the term of the loan, subsequent payments will be higher than the original monthly mortgage payment until the loan is purchased. Please understand that if the lender agrees to relax, your property will remain in foreclosure until the payment is completed. If tolerance is accepted, you will also find it difficult to refinance.
5. Deed-in-Lieu: Deeds in foreclosures are an option for the borrower to voluntarily trade the property to the bank. If the borrower is able to pay, the bank will not accept the foreclosure contract.
6. Selling: The borrower usually sells the real estate through the real estate agent or the selling owner, pays the loan, if the sales income is enough, the borrower evades the foreclosure.
7. Short selling: The borrower reached an agreement with the buyer to sell the house at a lower price than actually owed. Short selling must be approved by the lender and this may be time-consuming (from 2 weeks to about 60 days). If the borrower (owner) fully understands his/her legal obligations, short selling is still a viable option. With the credit crunch affecting banks and mortgage companies, more and more short sales are being accepted. If your debt is more than your home value, please contact us immediately to see if the short sale is right for you.
8. Refinancing: Homeowners can choose to refinance their homes. Free Refinancing Report This option may not be available if you have poor credit or insufficient assets in your home. At the same time pay attention to those lenders or brokers who like to use loan sharks and high-interest loans, leading homeowners to pay higher fees.
9. Sold to investors: We may be able to make up for your payments, late fees, foreclosures, legal and legal fees, and take over your current payment. Your records will be saved as foreclosures.
10. Do nothing: Your credit will be destroyed for 7 to 10 years. The lender will take your home and all your rights. If there is no equity, they may pursue your shortage or deficiency.
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Orignal From: If you are in foreclosure, you must know 10 steps
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