You actually have many options when it comes to seeking
relief from challenging housing payments. When reviewing the
following list, think about which alternative may be best for your
specific situation.
Short Sales
Generally considered one of the most viable alternatives to
foreclosure, short sales allow homeowners to minimize financial
damage and move on from a burdensome, unaffordable
mortgage. In many cases, short sales allow borrowers to qualify
for a new mortgage in as little as three years, as opposed to five
years or more after a foreclosure.
Mortgage Modification
A mortgage modification involves the reduction of one of the
following: the interest rate on the loan, the principal balance of
the loan, the term of the loan, or any combination of these.
Reinstatement
A reinstatement is the simplest solution for a foreclosure, but
often the most difficult to achieve. The homeowner simply pays
the total amount past due (including late fees) to the lender.
Deed in Lieu of Foreclosure
Also known as a “friendly foreclosure,” a deed-in-lieu allows the
homeowner to return the property to the lender rather than go
through the foreclosure process.
Forbearance
A forbearance, or repayment plan, involves the homeowner
negotiating with the mortgage company to allow them to repay
back-payments over a period of time.
Rent the property
This option requires the homeowner’s ability to rent the house
for enough money to cover the monthly mortgage payment.
Servicemembers Civil Relief Act
If a member of the military experiences financial distress
due to deployment—and their debt was entered into prior
to deployment—he or she may qualify for relief under the
Servicemembers Civil Relief Act.
Bankruptcy
Many believe bankruptcy is a “foreclosure solution,” but this
is only true in some states and situations. Entering bankruptcy
can be a risky and costly process. Be sure to seek the advice of a
qualified bankruptcy attorney when pursuing this as an option.
Refinance
Refinancing means you will acquire a new loan based on your
current credit standing. If you have already missed mortgage
payments, your credit score may make it difficult to find a loan
with cheaper payments.
Now that you know about the alternatives to foreclosure,
you have the power to act! Whether you’re struggling with
the mortgage today or are months behind on payments, it’s
important to choose an option that best. The fact that you are
reading this report is a great start!
How I can help
As a Certified Distressed Property Expert® (CDPE), I have
received extensive training to educate you about your options
and assist you in avoiding foreclosure. If you choose to pursue a
short sale, which is increasingly a strong option for most clients
I work with, I can help you navigate through the process.
Short sales have increased in number and popularity since the
beginning of the mortgage crisis because they:
··Help homeowners out of properties they can no longer
afford with lesser damage to their credit
··Help lenders avoid the major financial losses they would
incur in a foreclosure
·· Stabilize neighborhood property values because they
generally sell for more than a foreclosure would.
