1, Bring payments current:
This is always the tough one but the best approach is to go to family, friends etc., and borrow the money to get you current. You will need to get a payoff. Depending on what State you are in, determines where to get the payoff. If you get a chance, give me a call and we can discuss where you need to go to get it.
This needs to be started quickly. Some States have a very short “Go to Sale” period if nothing is done during the “Notice of Default” time. For instance, Nevada can take your property to auction in 21 days.
Some states do not have a Notice of Default period. For Instance, Colorado just has a Notice of Election and Demand, it states then when the scheduled sale date is.
To wait on trying to get this done, is a big mistake.
Federal and State laws come into play on this subject. The Federal government has made laws restricting charges a lender can make, as well as most States have done so also. Also, other laws placed on lenders so they are not taking advantage of a homeowner. The problem here is that most conventional lenders will not refinance you.
There are ways you can get it done though. Each property is different. If you would like to discuss this, please give me a text or call, or email me.
This is a way that you can sometimes save your property. A lot depends on the owner.
Your arrearages can be spread over a 5-year period. There are several ways to file. Don’t choose the wrong one. Give me a call and we can talk about it.
4. Selling through normal channels:
Most people don’t want to sell but keep this option open if nothing else works. It is better to get something, rather than getting nothing. If you do decide to sell, don’t make the mistake of just picking any broker. Foreclosure requires a broker that knows how to deal with the lender, the trustee, the title company and handle buyers’ comments when they refer to it being a foreclosure.
If you want to sell to get your equity, you want to get the best price possible. Don’t fall for the trick of a broker telling you a higher price than what the comps show. Most sales need and appraisal. The appraisal will refer to the comparables. If the price is to high, it will kill the sale, and if the price is to low, you won’t be a happy client.
One more thing. Don’t believe the values that are online. Zillow, Realtor.com, plus a host of others just do that by taking sales in a given area, dividing the purchase price by the sq. ft. and then multiplying what they think your sq. ft is to determine a price.
The makes big mistakes. A ranch style house is the most expensive to build and commands a higher sq ft price than a bi-level. Bi levels usually have the lowest sq. ft price. You must compare apples to apples and oranges to oranges. Don’t make that mistake.
5. For Sale by Owner:
This method can save you money, but it isn’t always recommended. The value of a real estate broker is they have the Multiple Listing Service. This is usually what sells the property. They have the contracts and the knowledge of which ones to use. Most properties that are in foreclosure require a special contract to get the sale done. They are familiar with title and how to clear up problems. They are the negotiator in the sale. Owners’ negotiating with a buyer usually goes south. Walk through provisions come into play. Brokers can show the value by getting comparables through their MLS. This is big when negotiating price with a perspective buyer.
Short sale. These exist quite often. Not all real estate brokers are familiar with how to do them. It is important you use one that knows how to get this done.
6. Quick Sale:
This option is used for houses that are dis-repair. Cash purchasers don’t need an appraisal to purchase the property, but you usually get a lesser value. Still, it is better to get something for your property that nothing at all.
7. Walking away
Never a good idea. With all the other options, why do it. If you want for people not to know where you are, sales can be closed through the mail etc. Call me on this please.
8. Reverse Mortgages;
Senior citizens take advantage of Reverse Mortgages quite often and are really helpful for a while.
They usually will let you get around 50% of the equity of your property. You may receive a check every month, or have no house payment.
What happens when that money runs out or you or your spouse gets sick. Reverse mortgages require that you keep the taxes and the insurance up to date, or they can foreclose on the house. They also require that you live there. If you get to the place in life that you need care, maybe you move in with a relative or a care facility. Once you vacate the property, the mortgage holder can foreclose.
If you get to this point, maybe you need to move it to a Life Estate situation.
9. Life Estates
Life Estates can be good for you. They can be set up in numerous different ways.
They give you all your life to live in a property without any payments at all. Talk to me about this option. It is not for everyone, but for some, it is a great way to go.