Financial hardship can strike any homeowner in Florida. Those who find themselves battling to stay in control of their finances may end up facing the possibility of foreclosure.
Foreclosure is a legal process initiated by a bank or lending agency that aims to repossess ownership of the property. It is a defensive measure taken by any loan provider to minimize possible losses when a mortgage holder fails to make consecutive monthly repayments.
As such, you might be wondering if there’s anything that can be done to prevent foreclosure. And we’re happy to tell you there is!
What You Can Do To Prevent Foreclosure.
In this blog post, we address this issue and discuss some of the Foreclosure Prevention Measures in Miami that you can take to stop your home from ending up in foreclosure.
Depending on the specifics of your situation, some of these suggestions may not be applicable. However, we’re still going to break them all down so you can make an informed decision yourself.
1┃PAY OFF your mortgage / SELL your property.
The fastest way to get out of foreclosure is to PAY OFF your mortgage. After all, the main concern for both banks and lending firms is whether they’ll lose money on your loan. If you can sell your house FAST in Florida or keep paying back the mortgage, there’s a high chance your loan provider will forgo the foreclosure process entirely. Admittedly, this is not always easy or possible – if you had the means or finances at hand to pay off your mortgage, you probably wouldn’t be facing foreclosure in the first place.
2┃WORK OUT a deal with your bank.
If you’re proactive about sorting out your situation and you get this across to your loan provider, they might let you work out a deal to avoid foreclosure. You may be able to sit down and discuss your options with a mortgage or foreclosure specialist. If you can get a discourse started about restructuring your mortgage plan, you might just be able to spread out your payments, so they’re lower each month. Just be sure that the deal works in your favor; otherwise, you could end up repeating the process in the future.
3┃DO a short sale.
A short sale involves selling the property and using the proceeds from the sale to pay off your outstanding loan amount. It does mean you lose the house, but it prevents foreclosure from impacting your credit score, and you’ll finally be free from loan troubles.
4┃GIVE your deed in lieu.
Another possible option would be a deed-in-lieu-of-foreclosure. This involves handing the deed of your house over to the bank in exchange that they agree not to initiate foreclosure. However, this option is only viable if your home is valued at a similar amount left on the mortgage. If not, the bank can pursue you for the difference and cause you more stress.
5┃FILE for bankruptcy.
Before you jump straight in thinking that filing for bankruptcy is the option for you, remember in many ways it is a far more damaging than foreclosure. Bankruptcy will impact your whole life and will remain on your credit report for up to 10 years. However, once you file for bankruptcy, you force the foreclosure process to stop, so it’s still considered a Foreclosure Prevention Measure.
If you’re still a bit confused and unsure what to do, consider the following advice:
If you can afford reduced payments and don’t want to move out, then (#2) WORK OUT A DEAL is most likely your best option.
If you’re looking for a fresh start and want to move forward without looking back, then consider Selling Your Home and Paying Off Your Mortgage with the funds from the sale.