Frequently
Asked Questions
- I
received a foreclosure notice. Have I already lost my home?
- Why
would a lender negotiate a payment plan with me?
- I
expect to walk away with very little cash when I sell my
house. Is selling worth the hassle?
- Should
I consider an offer from a real estate agent or investor
to deed my property to them to stop my foreclosure, and
then lease the property back to me?
- Should
I consider deeding my property to an investor who promises
to save my home from foreclosure and let me live there?
- A
bankruptcy attorney tells me that he can stop my foreclosure
sale. Is this true?
- My
mortgage broker offered to buy my home since I may not be
able to refinance. Should I do this?
- Why
is my final payoff figure so much higher than I thought?
- Whom
should I call when I get a notice posted on my door saying
that I am in foreclosure?
- Whom
should I go for help?
1. I
received a foreclosure notice. Have I already lost my home?
No! Your home is not lost until you are evicted. After you
receive the notice, you can still negotiate
a payment plan with the lender, refinance, or sell
the property. But don’t delay; more fees and penalties
will be added to your balance every month, making it harder
for you to resolve your situation. Read 10
Steps to Fight Foreclosure.
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2.
Why would a lender negotiate a payment plan with me?
Lenders want to have a few mortgage delinquencies as possible.
It doesn't look good for their books and it costs time and
money. Most lenders are interested in negotiating
a loan workout or forbearance agreement. Forebearance
agreements are payment arrangements to bring your loan current
over time. Learn
more about working out an agreement with your lender.
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3.
I expect to walk away with very little cash when I sell my
house. Is selling worth the hassle?
The penalties and fees in a foreclosure can eat up most of
your equity. It is often better to sell
your home to preserve as much of your equity and good
credit as possible. Even if you walk away with a little cash
after a sale, that money is better in your pocket than in
the lender's pockets.
But don’t fall for real
estate opportunists who are mostly trying to profit from
your troubles. Make sure you list your home with a reputable
real estate agent. Because a home sale takes time,
it is important to make a selling decision early in the foreclosure
process, or you will lose your home to the lender.
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4. Should
I consider an offer from a real estate agent or investor to
deed my property to them to stop my foreclosure, and then
lease the property back to me?
No. The problem with the lease-backs is that there are no
assurances that the agent will make the monthly mortgage payments
even though you are paying the agent rent. If the mortgage
is not paid, you may still lose the home. And if you are ever
late in payments, the realtor may evict you as a tenant and
sell the property. Learn more about Avoiding
Scams.
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5.
Should I consider deeding my property to an investor who promises
to save my home from foreclosure and let me live there?
Never! It will generate more headaches for you than you can
imagine. The only time to deed your property is when you sell
it for a fair price. Read more about this and other real
estate scams.
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6.
A bankruptcy attorney tells me that he can stop my foreclosure
sale. Is this true?
Yes. But bankruptcy
will only give you only a temporary solution. A bankruptcy
filing will only be successful if you have the necessary income
to make reasonable payments on a Chapter 13 plan. If you can’t
afford the payments or later fall behind, the bankruptcy will
be dismissed, you are back in foreclosure. You will have wasted
money on lawyers and court fees. Learn more about bankruptcy
and foreclosure.
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7.
My mortgage broker offered to buy my home since I may not
be able to refinance. Should I do this?
This is seldom a good option. The lender should try to work
out a payment plan with you. I believe that when a mortgage
broker is trying to buy your house, there is an inherent conflict
of interest, especially when the broker is going to purchase
the home for less than its fair market value.
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8. Why
is my final payoff figure so much higher than I thought?
Your mortgage payoff does not include just the principal balance.
It can include delinquent interest, late fees, attorney fees,
and advances for insurance and taxes. Learn more about getting
the best deal on a refinancing.
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9. Whom should
I call when I get a notice posted on my door saying that I
am in foreclosure?
Call the number of the attorney listed on the notice. Then
call your lender. Get the file number, and the day and time
of the foreclosure sale. Request a reinstatement
figure (the amount needed to bring the loan current) and
the current loan payoff amount (in case you want to refinance),
then consider realistic options for saving your home.
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10. Whom should
I go to for help?
For advice and guidance, contact one of the professionals
in our Resource Directory.
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