3 Things A Homeowner Needs To Know To Stop Foreclosure in Decatur
Bankruptcy vs. Foreclosure…Is it ever a good option?
Many homeowners view foreclosure as a way to get out of a mortgage payment. They see it as a fresh start but in reality, it has a negative impact on credit scores. Not only does this lead to higher interest rates for future loans but it also makes it difficult to obtain a loan. The loss of a home is usually inevitable if your lender has filed a NOD (Notice of Default) or you have missed more than 3 mortgage payments. Even at this stage, there are 3 things that you can do to stop foreclosure.
1. You can file for bankruptcy
When you file for bankruptcy, foreclosure immediately stops.
The federal law prohibits debt collectors from collecting their debts, including mortgage lenders. The federal law recognizes foreclosure as a collection activity and so if your lender becomes aware that you have filed for bankruptcy, they will freeze the foreclosure process.
It is important to remember that filing for bankruptcy does not let you off the hook for your debts; it simply buys you more time so that you can get another job or recover from temporary financial disability. The role of the bankruptcy
trustee is to mediate between you and your creditors once you go to court.
The law requires other creditors and your mortgage company to come up with a reasonable payment plan so that you can easily get back on track with payments. Filing for bankruptcy will have a negative impact on your credit score but it is better than foreclosure. You should also note that not everyone is eligible to file for bankruptcy. It is important to therefore consult with your bankruptcy attorney to determine whether filing for bankruptcy is a good option.
2. Negotiate with the bank
A good way to stop foreclosure is to talk with your bank if they hold the mortgage on your house. It would be much easier for them to negotiate with you because they know they would
be in a position to lose a huge amount of money on the deal if they repossess your house.
You can talk with them about a variety of options such as removing any past due balances, lowering your monthly payments or lowering your interest rates. Banks deal with foreclosures all the time and they are not that interested in the real estate business so the last thing that they want is
to get a portfolio full of real estate. They will provide you with several options and if they believe without a reasonable doubt that you have made the necessary adjustments in your financial life to start making payments again, then they will do everything in their capacity to work with you.
3.Use a Real Estate Investor
A good way to avoid foreclosure is to consider a real estate investor. Using a real estate investor can offer many benefits. If you plan on selling your house, an investor is a lot faster than using a realtor. Since you are trying to stop foreclosure, time is no longer on your side and a speedy process is needed. Realtors usually have many properties that they are working on and therefore, they need to divide their time and attention between these properties. Therefore, a realtor can take a long time to sell your property.
An investor typically offers cash and the ability to close fast. They do not need to negotiate between the buyer and the seller which can create many time consuming obstacles. Another benefit of a real estate investor is that they allow you to avoid dealing with financial distress because you will not have to deal with the stigma of foreclosure. It’s important to know that a real estate investor has dealt with all of these situations with professionalism. Investors are interested in providing a service to you. Selling your house and letting you move on with your life can help you relieve stress and put you back on the right track. A real estate investor can create offers personalized for your situation.
While trying to stop foreclosure, real estate investors are able to provide an offer that is specific to your situation. You may be looking to sell your house and get a lump sum of cash in a hurry. You may be interested in selling your house and getting a monthly payment that will help pay your bills or provide income in retirement. It could be that you are behind on your payments and you need an investor to make up your back payments, pay the fees, and bring your mortgage current. An investor can give you an offer that is customized for your situation and provide the solution that you are looking for.
In summary, these are three ways that you can do to stop a foreclosure. Once you realize that you may not be able to continue making payments, it is best to notify your lender as soon as possible so that they can give you a variety of possible solutions to your mortgage problems. This is because some lenders may insist on foreclosure if you miss three or four payments.