When the going gets tough, your house is at risk.
Sometimes things can get pretty bad financially. A few big expenses can turn a perfectly normal financial situation into an impossible one to manage. Whether you’ve had to pay for giant medical bills, had a divorce, or lost a good-paying job, you might eventually be staring down the barrel of foreclosure.
We’re here to tell you that this doesn’t need to happen. Avoiding foreclosure, even in the worst circumstances, is possible. No one intends to walk away from their mortgage, but when financial disaster strikes, many people are forced to.
Don’t let that be you. Let’s go over how you can keep foreclosure at bay.
Avoiding Foreclosure Is Possible
The rules for foreclosure are different everywhere. In Colorado, the grace period is 120 days after the last mortgage payment. That gives residents a good amount of time to get back on their feet and come up with the money, but the foreclosure process ends up starting a lot earlier.
To avoid foreclosure, you’ve got to go over your options with your moneylender. Communication is key and you don’t want to procrastinate because it’ll certainly result in the foreclosure of your home. Here’s what you need to talk about:
1. Modify the Loan
Talk to your mortgage servicer about modifying your loan a little bit. The terms of the loan are malleable as long as they don’t mind doing it.
The best and most common way to modify the loan is by adjusting the amortization schedule to make it longer. You can also lower the interest rate or try to have them roll the delinquent amount back into the loan and pay the new monthly balance.
2. A Repayment Plan
A short-term emergency may require a minor repayment plan to be put into place until you get your finances back in order. Something like a large medical bill might put you through some complications for a period of time, but that doesn’t mean that it has to sink you.
Talk to your lender about paying back the delinquent amount in installments over a certain period of time. This allows you to deal with your problem before it gets out of hand
3. Deed-In-Lieu
A deed-in-lieu of foreclosure is when you hand over your home to your lender so that you don’t have to go through the foreclosure process. You do this when you don’t see an easy way out of the hole that you’re in.
Sometimes a lender will waive the remainder of what you owe on the mortgage, allowing you to make a clean break from the house. Of course, it depends on the rules of your mortgage lender and which state you live in. In Colorado, a deed-in-lieu of foreclosure is a possibility.
What you need to ask your mortgage servicer before getting a deed-in-lieu of foreclosure is whether or not they’ll waive the deficiency. That’s the difference between the value of the home and what you still owe on your mortgage.
4. Filing for Bankruptcy
If foreclosure is imminent, then you could file for Chapter 13 bankruptcy, which would stop the foreclosure process in its tracks. When you file, an automatic stay goes into place, which halts the foreclosure until the bankruptcy process is over with.
Your lender can try to get permission from the court to go around the automatic stay and continue with the foreclosure proceedings, but it’ll still delay the process by a month or two.
Chapter 13 bankruptcy allows you to come up with a repayment plan. When the court approves this plan, you have to stick to it for 3 to 5 years to retain your home. It also wipes your debts clean, so you would theoretically have more money to allocate to your mortgage payments.
5. Sue
You don’t want it to come to hiring a lawyer, but depending on the type of foreclosure you’re facing, you could sue your lender. If it’s judicial foreclosure, you’ve already missed your chance to fight it in court. If it’s non-judicial foreclosure, you can sue the lender.
Of course, you need to have some legal reason why you’re suing them. Wanting to keep the house longer won’t cut it. Also, legal fees make suing a pricey option.
6. Sale
Making a quick sale on the home could be the perfect solution to foreclosure. You may think that the process of selling is too time-consuming and costly when you’re nearing foreclosure, but there are many services that allow you to sell within a few days.
It’s possible to make a short sale on your home as well. A short sale is when your lender allows you to sell the home for less than the amount of the outstanding loan and forgives the rest of the debt.
We buy houses as-is and when you fill out the form on our website, we get back to you within 24 hours with a firm offer. It’s fast, it’s fair, and it allows you to put an end to the pending foreclosure.
7. Hard Money
A hard loan from an independent lender would allow you to pay the outstanding mortgage payments and avoid foreclosure. The only problem with going down this road is that there’ll be much higher interest rates on the loan and they’re often secured by a piece of property, in this situation, your house.
If you don’t foresee your financial issues being a long-term problem, then a hard loan is a viable option.
Don’t Panic
If you don’t want to go through the foreclosure process, you don’t have to. Sell your Colorado Springs house to Bonnie Buys Houses Fast. We’ll buy any house, regardless of condition, location, or price so you can stop foreclosure in its tracks.
Visit our website to contact us about selling your home and we’ll send out an offer within 24 hours. Avoiding foreclosure can come at the click of a button, so don’t let it get you down.
