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- Reinstatement
If the reason for missed payments was temporary and has been resolved,
you may have the option to reinstate your mortgage right up to the time
of the bank sale. In order to reinstate, the homeowner has to pay all
missed payments, late fees, and legal fees that are due up to the date
that the loan is reinstated.
- Forebearance or Re-Payment Plan
If the reason for missed payments was temporary and the homeowner is not
able to make a onetime reinstatement payment, you may be able to negotiate
a forbearance or repayment plan. The lender may allow you to pay the missed
payment amount over a period of time or the lender may place the amount
on the end of the amortization of the loan. If the amount is to be paid
back over 12 months, once the homeowner completes the 12th payment the
mortgage would go back to its original payment amount. Note: typically
a mortgage is not fully reinstated through a forbearance plan until all
the payments are made in full. If you miss just one payment, you can end
up in the same stage of the foreclosure process you were in previously.
- Sell the Property
You have equity in your property, you can sell it and cure the foreclosure.
- Rent the Property
If you have payments low enough to allow you to rent the property and
keep up with the mortgage payment. Remember you will need to keep the
taxes and insurance premiums up to date.
- Refinance
If you have sufficient equity and income and your credit has not been
too badly damaged, you may be able to refinance your loan to lower your
payment.
- Mortgage Modification
You may qualify for a loan modification where the lender lowers the
interest rate on the existing loan in order to lower the payments.
You will need to submit proof of income and expenses.
- Short-Refi
This process involves the refinance of a home with a reduction in the
principal balance and often the interest rate as well. You will have to
quailify for this process both in showing a hardship as well as the ability
to pay the new mortgage often through a fully documented qualification process.
- Deed-in-Lieu of Foreclosure
Often referred to as a "friendly foreclosure" since the homeowner essentially
give the deed back to the bank. This may prevent the bank from having to
go through a lengthy foreclosure process and in exchange they will sometimes
forgo their rights to a deficiency judgment. This solution only works in
cases where there is one mortgage and no other liens. If you have equity
this is not a good option since you give up any right and equity to the
property.
- Bankruptcy
A bankruptcy may stop a foreclosure and allow a homeowner to reorganize
his debt and keep his property. A major drawback to bankruptcy is that
it makes it very difficult to sell the property once you enter the process
and near impossible to negotiate a short sale. Be sure to consult your
attorney for other ramifications associated with bankruptcy.
- Service members Civil Relief Act (SCRA)
The SCRA is a bill that was signed into law on 12/19/2003. This law provides
certain protection to military personnel that are in foreclosure in specific
situations and also provides other protections.
- Short Sale
If you owe more than your home is currently worth and one of the above
solutions do not apply to your situation, you have the option of pursuing
a short sale. A short sale occurs when a negotiation is entered into with
your mortgage company(s) to accept less than the full balance of the loan
at closing. A buyer closes on the property and the property is "sold short".
A seller without financial hardship that is upside down on their mortgage
and want to sell is not a potential short sale.
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CDPE
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Real estate professionals trained
to assist financially distressed homeowners find the best solution for their situation.
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The Snyder Group
702-610-0096
www.dalesnyder.net
Disclaimer: The information provided on this website should not be constituted
as legal advice. The content is intended to provide general information about
the short sale and foreclosure processes, and should not be acted upon without
the counsel of a qualified REALTOR®, attorney, and tax expert.
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