How to Avoid Foreclosure & Save Your Home
Options to Avoid Foreclosure
When you're going through a possible foreclosure, what options do you really have? The short answer is not very many. Chances are you probably know someone who has been through a foreclosure or you might be going through the process now. There's nothing worse than the feeling of possibly losing your home and having to relocate unwillingly. This article is to let you know that there are options you have to avoid foreclosure. A foreclosure can ruin your credit and stay on your credit report for years. This article will cover the options of few ways you can possibly stay in your home as an owner or as a renter.
First and foremost regardless of what you want to do is asses your situation. Find out what your home's market value is. This will let you know what options are best for your situation. Most people want to stay in their home because they've spent so much time caring for the property with memories built into each room. It's understandable. If you want to stay in your home as the originally owner, you have a couple of options available. You can do the most obvious and contact your bank to discuss options. The bank will want to ensure that you are financially stable enough to formulate a payment plan for payments missed. When I write payments missed, you can bet there will be late payment fees, administrative payments, and any other creative fees they want to stack on the bill. The process of getting caught seems almost designed to fail by nature with interest on late fees and mortgage payments missed.
The other option available for owners to stay in their home is one that you never want to use as a first resort but as a last. Filing for bankruptcy is almost as embarrassing a situation as a foreclosure. In some instances, it may stall if not stop a foreclosure. Of course seek counseling from a bankruptcy attorney since there are so many that provide these services in today's market. The two options you'll have for filing will be a Chapter 7 & 13. The difference between the two is the chapter 7 liquidates your assets (your home too in some instances) along with your debt. A Chapter 13 is a repayment plan so to speak.
Another option to staying in your home is finding an investor to buy the home. Once they buy the home they rent it out to you because they know you have invested time and monty into the property. Of course the market and the cost of the property will ultimately determine how difficult or easy it is to find an investor. If you owe 60% of market value or less, you'll have a good chance of finding someone for this option. A good source of finding what your home's market value is by going to the website: http://www.zillow.com/ An example of what I mean is: you owe $132,000 and your market value of the house (found by using the zillow website) is $220,000. With these numbers, you should be able to find a buyer for around the price still owed a maybe a little extra. In return, he/she gets a reliable tenant.
No one wants their home foreclosed but these are a few ways of possibly avoiding it. You should, however, consult an attorney or bank to discuss options.