Stop Foreclosure Quickly with a Convenient Cash Home Sale
By Johnathon Case
Facing foreclosure is a scary experience. You risk losing your home and any equity that you may have accumulated.
When you want to know how to stop foreclosure at the last minute, you may not have a lot of options. Unless you can sell your home quickly, there is not much that will stop the bank from foreclosing on your property.
Luckily, there is a way to sell your home quickly. By selling your home to a cash buyer, you may avoid the disadvantages that come with a foreclosure.
Understanding the Foreclosure Process
Most homeowners don’t understand how foreclosure works, which can make the experience even more frightening. When you take the time to understand the process, you’re better prepared to review all your options.
Foreclosure is a legal action that lenders may take when homeowners don’t make their monthly payments. They typically initiate the foreclosure process after the homeowner has repeatedly missed payments.
Unfortunately, unexpected events can get in the way of your regular mortgage payments. A medical emergency, loss of work, and other unforeseen financial situations may make it impossible to keep up.
In most cases, lenders can start the foreclosure process when you’re at least 90 days behind on payments. The process begins when you receive a notice of default from the lender.
After receiving the notice, time is running out to consider your choices. At this point, you may want to consider selling your home for cash. Instead of allowing the stress of the situation to build, you can get out of your home and move on.
At Sell My Old House, we regularly work with individuals who are facing foreclosure. We can often complete the sale within two weeks or less.
Difference Between Notice of Default and Notice of Trustee
When you get 90 days behind on payments, your lender may send you a notice of default. This letter indicates that your lender is giving you 90 more days to bring your mortgage account current. The time frame can vary but 90 days is the standard for most lenders.
During these three months, you are in pre-foreclosure. Your credit isn’t jeopardized. You also still have time to pay your mortgage payments or sell your home.
However, if you don’t resolve the issue within 90 days, you’ll receive a notice of trustee. The notice of trustee is also known as the notice of sale.
The notice of trustee informs you that your lender plans to foreclose on the property. The letter should also include an auction date, which is typically set for 21 days from the date the letter was received.
Five days before the auction, the auction can’t be stopped. If you receive a notice of trustee or a notice of sale, this is your last chance to pay your late payments or sell your property.
Reviewing Your Options for Stopping a Foreclosure
The first step in understanding how to stop foreclosure is reviewing your options. Depending on where you’re at in the foreclosure process, you may have a few choices:
- Mortgage modification
- Special forbearance
- Chapter 13 bankruptcy
- Fast home sale
Only one of these options saves you from your obligations. Selling your home to a cash buyer puts a stop to the foreclosure process quickly and allows you to move on to the next chapter of your life.
With a mortgage modification, your lender modifies your loan agreement to work the late payments into a new mortgage. Unless you qualify for a lower interest rate, the modification will involve refinancing or extending the term of your mortgage.
The modification may not fully resolve your issue. You’ll still have payments and your mortgage may be extended.
Some lenders offer special forbearance when borrowers struggle to pay their monthly payments. This is generally reserved for individuals facing unexpected financial issues such as loss of work or medical emergencies.
With special forbearance, your lender may reduce or halt your payments for a short period. They may also create a repayment plan to help you get caught back up.
When the forbearance period ends, you may need to make higher payments to make up for the reduced or halted payments. With this option, you’re only getting a short reprieve.
Chapter 13 bankruptcy should be avoided whenever possible. It hurts your credit for many years.
The next option is often the fastest and most effective. Instead of modifying your loan, requesting forbearance, or filing for bankruptcy, you may want to sell your home.
With a fast home sale, you may receive enough funds to get out of your mortgage. A short sale may be completed quickly, putting a stop to foreclosure.
Can You Sell a Home to Stop a Foreclosure Auction?
If you want to know how to stop foreclosure auction immediately, selling your home may still be an option. Keep in mind that you don’t have a lot of time.
Lenders often send the notice of sale with an auction date after you’ve already been given 90 days to pay your late payments. You then have 21 days before the auction.
In most situations, you need to sell the property or pay your late payments at least five days before the auction. Within five days of the auction, it’s too late to stop the process and your home will get put up for auction on the specified date.
It’s also important to review the foreclosure laws in your state. As the laws can vary, the five-day timeframe may be longer or shorter in your state.
How Can You Sell Your Property to Avoid Foreclosure?
Selling your home using the traditional methods may not work when you’re facing foreclosure. It takes an average of three months to sell a property. If the foreclosure process has already started, selling your home becomes even more of a challenge.
Prospective buyers may choose to wait for the foreclosure auction to get your home at a lower price.
Selling your home to a cash buyer may provide an effective solution. These sales are typically completed in two weeks or less.
At Sell My Old House, we can even accommodate faster sales. If you let us know that you’re facing foreclosure, we may be able to speed the process and get you out of your mortgage within days.
Consequences of Dealing with a Foreclosure
Some homeowners may allow the foreclosure to take place as they feel that they have no other choice. Understanding the consequences of foreclosure may force you to review the options discussed, including a fast sale to a cash buyer.
If you allow the process to continue, your lender will likely sell your property at an auction to recoup their losses. Your troubles don’t go away after the bank sells your home. The consequences can continue to haunt you for years.
When your home gets foreclosed, you get evicted from your property. Your home is no longer yours and you lose any equity that you’ve built over the years.
You’ll also receive a notice letting you know how long you have before needing to vacate the property. In some cases, you may only have days or weeks.
The foreclosure also destroys your credit. You may struggle to get a loan for a new home. Bad credit may also make it difficult to find other living arrangements as landlords often run credit checks.
You may also still owe money on your property. After the lender sells your home at the auction, your lender may require you to pay any difference between your outstanding mortgage and the sale price.
For example, you have $110,000 remaining on your mortgage and the lender auctions your property off for $100,000. You would still owe $10,000 to the lender.
After foreclosure destroys your credit, you may also face difficulty landing a new job. Employers may run background and credit checks, especially if your position involves finances or accounting. Foreclosures appear on the credit checks.
Foreclosure needs to be avoided at all costs. If your time is running out, don’t hesitate to sell your property for cash. It may not be too late to avoid these disadvantages.
Conclusion: Selling Your Home May Be Your Only Option
There are not many choices for those who want to know how to stop foreclosure sale date from occurring. You can work with your lender to modify the loan, file for bankruptcy, or sell your property.
In many situations, selling your property may be the best choice. A fast home sale is convenient and eliminates the hassle of dealing with the foreclosure process.
When you sell to a cash buyer, you can complete the sale in days or a couple of weeks. You also avoid the typical challenges of selling a property.
You don’t need to worry about paying real estate agent fees or closing costs. At Sell My Old House, we eliminate the need to wait for banks and buyers. You simply get fast cash for your property.
If you’re facing foreclosure, now may be the right time to consider selling your home. Don’t wait too long as your lender may not leave you without a lot of options.