What’s the best course of action when a homeowner is facing foreclosure?
That’s a difficult question to answer.
Mortgage defaults are quite high, primarily due to COVID. The last thing a homeowner wants is for their lender to repossess their home against their will… unfortunately, that’s exactly what foreclosure means… that the lender is going to sell the house to the highest bidder at an auction to recoup their money.
To avoid losing their home and severely damaging their credit, the homeowner should work with the lender throughout this process — it’s okay that the homeowner can’t make their payments (they’re definitely not the first person to go through financial distress) — the mortgage lender will likely be willing to work with the homeowner… and the sooner the homeowner reaches out during this process, the better.
If they are behind on their mortgage payments, there are early strategic exit from a position that will only get worse if they wait. Here are some ways to get ahead of the problem…
Short Sale Possibility — A short sale is when the mortgage lender allows the homeowner to sell for less than is owed on the mortgage. We buy homes fast for cash at Hammock. Give us a call at 813-324-3131 to learn more!
File For Bankruptcy — This probably isn’t the best option in the world, but if things have gotten pretty rough financially, then a homeowner might consider filing for bankruptcy, which stops the foreclosure process in its tracks (for a few months, at least).
Secure Private Money — The homeowner could also try to secure private money to pay off their loan. But this will likely be at a much higher interest rate.
Facing foreclosure is never easy, but hopefully the above advice will help!