Foreclosure is a daunting prospect for many homeowners across the United States and right here in Sacramento. But before we dive into the nitty-gritty, let’s unravel the enigma of “pre-foreclosure.”
Picture this: numerous homeowners grapple with the challenge of making their monthly mortgage payments. When a homeowner falls behind on payments, typically missing 3 to 6 months’ worth, the lending institution steps in with a warning—a last chance to make things right. This crucial phase is known as “pre-foreclosure.”
During pre-foreclosure, banks and mortgage lenders usually grant homeowners around three months to catch up on their payments, though this duration can vary from case to case. Failing to do so results in the bank foreclosing on the property, taking ownership, and evicting the homeowner. Fortunately, during this period, there are several avenues for homeowners to explore to prevent losing their homes.
Options for Homeowners in Pre-Foreclosure
If you find yourself behind on mortgage payments, you’ll likely receive a “notice of default” from your mortgage lender. This document essentially states that you haven’t made mortgage payments for the past 90-180 days. The key is not to panic because you have some options that can delay or even prevent the loss of your home:
Refinancing: If your mortgage is “above water” (meaning you have equity in your house), you might be able to refinance your mortgage, leading to lower monthly payments. You can consult your local Sacramento mortgage broker or reach out to us at Laurel Buys Houses, and we can connect you with a reputable one.
Sell to a Real Estate Investor: You can consider a quick sale to a reputable real estate investor in Sacramento, like us at Laurel Buys Houses. This can provide you with the cash needed to cover your back payments, or we may be able to work out a solution with your lender to relieve some or all of your back payments. We’re known for buying Sacramento-area homes quickly, often within a week or two, offering cash payments and removing the stress of finding a buyer.
Short Sale: Contact your bank and inquire about a short sale. In a short sale, you sell your home for less than its value, and the bank absorbs the loss as a tax write-off. Keep in mind that in some short sales, you may still be responsible for covering the difference if the house doesn’t sell for the full loan amount.
Bankruptcy: In some cases, declaring bankruptcy may buy you additional time to address your debt. However, be aware that bankruptcy has significant consequences, including long-term impacts on your credit report.
Lenders understand the financial challenges many face, and they’re often willing to work with borrowers who communicate honestly. A foreclosure can be a severe blow to your credit score and financial prospects, potentially affecting your ability to secure a loan for years to come.
If you find it challenging to reach a solution with your lender directly, don’t hesitate to get in touch with us at Laurel Buys Houses. We might be able to offer assistance and explore various solutions.
How We Can Assist in Pre-Foreclosure
Short Sale Potential: Submit your information on our website, and we’ll assess your situation to determine if a short sale is a viable option.
All-Cash Offers: We’re interested in buying houses in the Sacramento area. If you’re looking to sell, we can provide you with an all-cash offer. Just fill out the form on our website to get started.
Free Guidance: We’re happy to answer any questions you have and provide free guidance and resources to help you make an informed decision. There are no hidden fees or obligations—just genuine assistance.
In pre-foreclosure, there’s still time to explore solutions. You can initiate contact with your bank to discuss potential arrangements, or feel free to reach out to us to learn more about selling your house or accessing our free foreclosure resources.
For a discussion of your pre-foreclosure options, call us at (916) 476-2381, or you can submit your information on our website to receive a cash offer for your house.