If you’ve fallen behind on your mortgage payments and are facing foreclosure it can be a scary feeling. It’s easy to feel like you are quickly running out of time and options.
However, if you find yourself in this position it’s necessary that you take action quickly. Doing so could be the difference between losing your home and finding a way to deal with your situation.
There is no perfect solution but you do have options. The important thing is that you don’t panic and you determine what your next steps are right away.
Here are five steps to take when you are facing foreclosure:
Contact your Lender
I know, I know, contacting your mortgage lender is probably the last thing you want to do. Falling behind on your mortgage payments is embarrassing and so the last thing you want to do is talk about it — least of all to the company you owe money to!
But being honest about your situation is the key to changing it. And the truth is, your lender will lose money in the event of a foreclosure. So odds are, they don’t want that to happen any more than you do.
However, if you are avoiding their phones calls and you’ve stopped checking your mail so you won’t see the overdue notices then you aren’t giving them the option to work with you. The earlier you communicate with your lender, the better your odds are of making some kind of arrangement with them.
Your lender may be willing to temporarily modify your payments so they will be more manageable for you. Some lenders are willing to arrange a forbearance; this is when payments are temporarily suspended for a period of time.
However, a forbearance will end at some point and you may have to make a lump sum payment at a later date. But it can still buy you a little time while you get back on your feet.
Get your Paperwork in Order
Get your paperwork in order so you can stay organized and on top of the situation. At the very least, gather together all of your mortgage documents including your account number, monthly statements, and your loan booklet.
But it’s also a good idea to gather together any relevant financial information such as bank statements, tax returns, and any government benefits you receive. You may also want to compile a list of your monthly expenses.
Research your State’s Foreclosure Laws
Depending on the state you live in, the foreclosure process can take anywhere from just a couple months up to a year. Foreclosure laws vary from state to state so it’s important to know what the laws are where you live.
This will help you figure out what kind of timeline you have to work out a deal with your lender before you lose your home. It will also help you learn what your rights are during the foreclosure process.
Here is some more information on foreclosure laws for home buyers in Kansas.
Watch out for Scammers
Because you are facing financial difficulties, this puts you in a very vulnerable position. Scam artists prey on people like you who are afraid of losing their home and are desperate for a way out.
The Federal Trade Commission has warnings about some of the most common mortgage relief scams. Many companies will promise to help you find relief from your situation but in reality, their “help” can end up making your predicament worse. Watch out for fake loan counselors or anyone who tries to convince you to give them money upfront or sign your home over to them.
If you aren’t sure whether a business is legitimate or not, do your research. Check their rating with the Better Business Bureau and read their online reviews to see what kind of experience other customers have had with them.
Consider Selling your Home
Unfortunately, you may reach a point where all of these options aren’t enough. You’ve have done everything possible in order to keep your home but you’re still facing foreclosure.
If you reach this point, you may still have time to sell your home and avoid foreclosure. There are generally two ways you can go about this:
Attempt to go the traditional route and try to sell your home through a real estate agent.
Or you can sell your home to a real estate investor.
Let’s look at both of these options more closely.
If you are considering selling your home through a real estate agent, it is unlikely to be a quick process. Your agent will most likely want you to make repairs and updates to your house before putting it on the market. And then once it’s on the market, it can take months to even find a buyer.
And once you do have a potential buyer, you will have to go through negotiations before the sale can take place. The buyers may request that you make more upgrades to your home. And then after all this, the sale could still fall apart at the last minute leaving you back at square one.
Now you’re out time and money, two things that were already in short supply to begin with.
A better option for you to consider is working with a real estate investor. A real estate investor won’t charge you any commission fees and won’t request that you make any upgrades to your home. Instead, they can make you a fair cash offer and close in as little as a week.
Facing foreclosure is a scary prospect but you don’t have to go through it alone. HouseMax is a family-owned company with employees who know the ins and outs of the Kansas City real estate market. We’ve helped many people get out of situations just like yours.
If you’re facing the threat of foreclosure and need to sell your home fast in Kansas City, we can help. Contact us today and we can make you a cash offer for your home in Kansas City.