Foreclosures - A Choose Your Own Ending Story
By Kathleen Couch

You keep struggling every month to pay the mortgage payment, and the other bills you have. Or you know in the near future it will not be possible to keep up. In the past the obvious solution was to refinance, and cash out some money to pay off bills, or sell the house, and take the profit.

Suddenly what has been taught to the homeowner to do in case of emergency, is no longer shining as the crisis solver. What makes it worse is in the time of easy buying, people were often put into homes they could not really afford, but were given low teaser rates, with the understanding the rates would go up drastically in the set amount of 3 to 5 years. The concept was, not to worry because you can always refinance, or sell the home before the rates went up.

The values of homes have dropped and homeowners cannot get refinanced to get out of their situation. Many try to sell the home for just enough for what they owe, but to no avail. The house is now overpriced for the market. Even if they would get a contract, there is a good chance it will not appraise for what the selling price is.

Which ending of the story will you choose?

ENDING ONE

The first choice is to start early in talking with the bank. By early, this mean to be aware of when the interest rate is going up on your mortgage, and make some plans for that. If only one person is working in the family, it might mean just a part time job would be needed to cover the increase mortgage costs. Another strategy is to see if you qualify, and the bank will cooperate with modifying your loan. There are a lot of different plans out there, and the best way is to talk with your bank to see if you qualify. If you are successful in bringing in extra income, and modifying your loan, this may be the end of your foreclosure story.

ENDING TWO

If you have talked with the bank, but cannot get a loan modification, or just feel staying in the house is too much to handle, you can sell to an investor. Sometimes you can sell by the investor taking over payments. This does not work well if your mortgage balance is high, and your interest payments are also high. Another option is to have an investor, or short sale negotiator to negotiate a short sale with the bank. A short sale means getting the bank to accept less than the amount owed to them. This is done by having a contract for sale presented to the bank at a discounted price, that can be documented to make sense. The short sale negotiator also needs authorization from the seller, and to collect certain financial documents from you. You need to have patience in this process, but a successful outcome will sell the home to settle the debt obligation. The homeowner will not receive any money from the sale, but also will not have a foreclosure on their record. The ethical short sale negotiator does not take any money from you. They will get their payment from commission, or from buying the home themselves, and re-selling. This may be the end of your foreclosure story if you so choose.

ENDING THREE

Maybe you have talked to the bank, but often you are just ignoring their calls. Your sticking your head in the sand, and hoping they will go away. At some point you decide you are just going to pack up and leave the house. The property is advertised as a notice of foreclosure, and it is auctioned. In some states there is a court hearing, and in others it is a non-judicial action, meaning it happens without court. When it is auctioned, the home is either purchased by someone who bids at the auction, or if it is not purchased by a third party, it goes back to the bank, and becomes the problem of the bank to sell. If you have not moved out, you will be evicted after the auction. With this scenario you will have a foreclosure on your credit record. This may be the end of your foreclosure story if you so choose.

If you would like to choose ENDING TWO for the end of your story, you can get the help you need by contacting one of the companies at the end of this article

Kathleen has formed a new company, KC Real Estate Solutions for the purpose of assisting homeowners, and selling the home at a discount. I may be contacted by going to www.KCRealEstateSolutions.com

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