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So,
the big question is, WHAT OPTIONS do you have, IF you
can't make your payments and you will be going into
foreclosure if something doesn't change?
A Short Sale may be the best option
for you, but it is in your best interest to first read
your options below and determine if there is a way to
keep your home.
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1. Do Nothing –
If you do nothing, you will most likely lose your home at
a foreclosure auction. It'll immediately affect your credit
200- 250 points and remain on your record for 10 years! You
will probably feel you should have looked at better options.
2. Refinance –
Completely paying off the entire loan amount plus any default
amount and fees. Of course, this isn't really an option if
you bought with no down payment and the value has dropped
or if you bought using "Stated Income" and the income
used wasn't really accurate. Since the August 2007 Mortgage
Crash Lenders have either eliminated the Stated/No Income
Verification Loans or made them impossible to qualify for
with increased Credit Score and Loan Equity Requirements!
3. Loan Modification –
Contacting your mortgage company to change the terms of the
debt or extend the terms of the loan. This may allow the homeowner
to catch up at a more affordable level. To qualify, you must
prove to the lender you have fixed the problem that caused the
late payment.
4. Bankruptcy –
This option can eliminate debt and/or allow more time. The
guidelines have gotten much stiffer on who is qualified to
have their debt eliminated. Be sure to fully understand the
process and it's consequences before declaring bankruptcy.
This will affect your credit 100-150 points and report for
10 years after the discharge date.
5. Sell your home –
If the property has equity you could normally put your house
for sale through a Traditional Realtor and sell your home
to a new family. Problem here, is there are so many distressed
sales in the 2007 Real Estate Market locally, unless you are
willing to take way less than you would in a normal market,
your home will not sell.
********* Final and Best Option
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6. Short Sale -
Also known as a pre-foreclosure sale, can be negotiated with
your lender by us, your Short Sale Expert if what is owed
is MORE than the property's value. Since David P. Ottersen
has special training in the Short Sale transactions, and is
A Licensed Real Estate Agent, Property Manager and Florida
Mortgage Broker your chances of getting on with your life
after the sale are much better than using a traditional Realtor
who has only sold homes in a normal real estate market, and
leaves you to fend for yourself after you vacate your Home.
About Short Sales
First of all, a Short Sale is not for everyone.
If you have a valid reason why you can't make your payments
and you have no equity to sell your home for what you owe,
then you are a good candidate for a short sale.
The process can seem long and painful if you go into the
transaction without knowing what to expect. If you know what
to expect, then it is not too bad and actually can help you
in quite a few ways, (besides saving your credit from foreclosure
and/or a deficiency judgment).
If you are unsure as to what a Short Sale is, it's a transaction
where your Realtor negotiates with the lender to accept less
than is owed on your total loans due plus any deferred interest
in order for you to sell your home in Today's 2007 Housing
Market.
Let's look at the process and an estimated
timeline of an average Short Sale.
In this scenario, let's assume the person's name is Smith
and he has missed two months of his mortgage payments and
he sees no way to come up with the money to catch up on his
payments.
First week -
Smith decides he needs to call someone for help regarding
his situation. He meets with a Short Sale expert and authorizes
'The Expert' to help him out.
Second week -
The Expert has a professional inspector go through Smith's
house and make a list of repairs and take pictures of the
home.
Third week -
The Expert will have received various offers to buy Smith's
home and he will begin to present the offers to the bank in
order to begin negotiations.
Fourth week -
Smith is about 3 months behind at this time and the bank will
soon be filing a NOD (notice od default) which means that
a Foreclosure sale will be scheduled after 3 more months of
being in default.
Between 2nd and 4th month -
Usually at some time in this time period, a Short Sale approval
will be given by the bank. The new buyer will be given between
10 and 30 days to perform (arrange their financing and close
escrow).
After the Close of Escrow -
Smith will have saved up some money and will now move out
of his house and into a new place that he can affrod for the
time being, until he feels ready to buy a house again. We
at East Orlando Short Sales will also help you find a new
Rental Home within your Budget to help you re Start your New
Life within your means and affordability.
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