Avoid Foreclosure Through Pre Foreclosure
Almost every year, there are tons of people worldwide who are facing foreclosure. Some lenders aren’t diligent to check the person’s ability to make repayments and others simply don’t care. There are circumstances of course wherein there is a sudden turn of events towards the life of a person leading to their inability to pay for their mortgage.
It doesn’t matter what is the reason for why the client starts to lag on payments because from that point, it’s set. Initially, the lender is going to file for public default notice. This is going to kick off the process of foreclosure and at the same time, this is the point when it officially starts the pre-foreclosure. Simply put, pre-foreclosure is the homeowner’s grace period to settle whatever issue they have in their home.
The homeowner is warned that they are in default and have to take actions to solve it. But at this point onwards, the lender couldn’t claim the property back and sell it to recover their expenses. The duration of grace period will vary depending by the state laws. Some states have a grace period lasting for 6 months but in most cases, the grace periods are shorter than this. As soon as the property entered pre-foreclosure, there are several ways that the homeowner can steer clear of facing a foreclosed property and have it sold by the lender. Two of the common options available are discussed in the next lines. If you want to learn more about it, I suggest you to keep on reading.
Number 1. Pay off the default – if for instance that the homeowner can’t find the cash to settle the default amount, then the property will be removed from pre-foreclosure. In the event that the default amount is small and that the default was caused by temporary glitch, then it might be worthwhile to take out personal loan to repay the debt. In case that the problem is ongoing, then this might open up more issues for the homeowner.
Number 2. Sell the house – this is more of a drastic move but this is no doubt the best solution you can have if you can’t really make the repayments. You as a homeowner will be able to get reasonable prices by selling it. Waiting for the lender to sell the house on the other hand is not a good idea as the sale price will be lower. This is because the lender will offload the property as quick as they can.
While there are options for you to avoid foreclosure, still it will be recommended that you make your best efforts to not get to this point.