Posted by
admin on Jun 12, 2009 in
Foreclosures,
Housing,
Marketplace The first stage in the foreclosure process is Preforeclosure
This is when the bank files the foreclosure lawsuit. In some states, its called the Notice of Default and in other states, it’s called a Lis Pendis. The bank can file the foreclosure lawsuit when the borrower becomes 3 payments behind.
During this period, the borrower has options to solve their situation:
- They can pay off the lender in full.
- They can bring the loan current for all of the past due payments and attorneys fees due.
- They can do a workout with the lender to negotiate a repayment plan, loan modification of forbearance.
- They can sell the house and move
- They can sell the house to an investor and lease it back
- They can refinance the home with an equity lender.
- If they owe more than the home will sell for, they can do a short sale with the lender. This stage only occurs in a judicial state, It does not occur in a non-judicial state.
The 2nd Stage in the foreclosure process is the Auction or Trustee Sale
- This is where the bank brings the property to public auction.
- The sale date is set by a hearing 3-4 weeks before the actual auction occurs.
- The homeowner has the right to attend the hearing and request an extension to get the home sold. Most of the homeowners we work with that attend this hearing can buy themselves an additional 3 days for a total of 60 days.
- 95% of the homes that go to auction go back to the bank as an REO.
The 3rd stage in the foreclosure process is the REO stage
- REO stands for Real Estate Owned. This usually costs the bank anywhere from 35,000 -50,000 to take a home back in foreclosure. This is the 3rd and last stage of the foreclosure process in a judicial state. The property becomes an REO if the property does not sell to a third party bidder at the auction.
Foreclosure Timeline
The time line for a foreclosure dictates the options you have. The longer you wait to deal with the problem the less options you have.
30-90 Days late
Many more options – including saving your home – than folks know about, and many are not very painful.
90 Days +
The absolute best options and opportunities to save your home lessen and are much more restrictive. This also diminishes some of the sales opportunities.
Attorneys letters – Lis pendens
Several easy solutions are no longer available.
Sheriff notice
We can still salvage your credit and possibly your equity, but every day you allow to go by reduces your options.
Sheriff sale and foreclosure!!
A foreclosure will be on your credit report for at least 7 YEARS. But, worse than that, PUBLIC RECORDS will show this legal action for the statutory period of a judgment in New Jersey! The bank will file a deficiency judgment that must be satisfied before you can buy another house. This does NOT happen with the other options we can employ for you. With foreclosure, your credit is devastated. The reduction in your credit score is more then 2 or 3 times what it is for some other options. That means higher interest rates AND higher purchase prices for almost anything you want to buy.
Short Sale Instead of Sheriff Sale
We can assist you with bringing your credit back to a level for you to again own your own home much sooner than you think. The government is responding to the housing crisis by offering legitimate mortgage options so people don’t have to resort to subprime mortgages and predatory lenders anymore.
Are you behind on your payments? See what your option are at http://www.i-teamhomes.com/foreclosure.htm or call us at 609-417-1084. Don’t lose your home unnecessarily.
Tags: distressed home owners, distressed owners, distressed property, foreclosure, short sale, short sales
Posted by
admin on Feb 20, 2009 in
Foreclosures,
Selling,
for sale For Immediate Release:
February 18, 2009
(Edison, NJ) In today’s unsteady economy, many homeowners experiencing financial difficulty have turned to a short sale as a means of avoiding a foreclosure. In many cases, sellers who cannot keep up with their mortgage payments strike a deal with their lender to sell the home and payoff less than the total amount due on the loan. In some cases, the lender forgives the outstanding debt. A short sale can occur in any real estate transaction where the purchase price is less than the amount required to pay off the liens on the real property, such as mortgages, judgments, taxes, homeowner or condominium association fees, assessments, as well as closing costs including but not limited to brokerage commissions, realty transfer fee, and attorney’s fees.
There are key advantages to pursuing a short sale over a foreclosure. Depending on how the lender reports the loan, short sales can appear on your credit report as “pre-foreclosure in redemption,” not as “debt discharged due to foreclosure.” Thus, people who come to an agreement on a short sale with their lender do far less damage to their credit rating than those who go through a foreclosure. Additionally, a benefit to a short sale is that borrowers will generally face a shorter waiting period before they can obtain another mortgage.
“In general, a short sale can be much faster and less expensive than a foreclosure,” said 2009 NJAR® President Diane Dilzell, CRS, e-PRO. “Troubled homeowners should remember that a short sale is not a cure-all but the ramifications are less harmful to their long-term financial well-being.”
Homeowners who are having difficulty making their mortgage payments and who may be considering a short sale must generally meet three qualifying criteria: they must be behind on their payments, be able to prove a legitimate hardship, and have little or no equity in their home.
Sellers should be aware that a short sale is a complex transaction and can take several months to complete. A short sale also requires several parties to come to an agreement on negotiated terms. In addition, different lending institutions have different policies. Some lenders may agree to forgive the difference between what they are owed, while others may require repayment of the deficiency. If your lender “writes off” any portion of the amount owed it may be reported as taxable income. Therefore, sellers should always seek the advice of an attorney or tax professional.
Dilzell noted that a REALTOR® is a valuable resource to home sellers considering a short sale. REALTORS® can help consumers navigate the short sale process, as well as facilitate communication between interested parties.
“REALTORS® don’t just sell houses; we work to help people to afford to stay in their homes. In the end, we want troubled homeowners to know that a foreclosure might not necessarily be their only option. Whether it’s a refinanced loan or a short sale, resources are available to homeowners having difficulty making their payments,” concluded Dilzell.
Tags: foreclosure, homes for sale, listing your home, selling your home, short sale
Posted by
admin on Feb 8, 2009 in
Announcements,
Foreclosures New Jersey has implemented a new initiative called the NJ Judiciary Foreclosure Mediation Program for home owners who are in foreclosure. NJ is trying to help prevent as many foreclosures in the state as possible. Foreclosures are not a winning solution for any of the parties in today’s economy. The home owners don’t want to lose their homes, the banks don’t want any more asset on their books that will take months to dispose of (at a substantial loss, probably), and the municipalities don’t want the vacancies and loss of property tax revenues.
So, if you’re one of the NJ home owners currently facing foreclosure, check out our web site that outlines the different options you have (the sale of your home is NOT the only option you have) besides waiting for foreclosure. We also have details on the NJ Judiciary Foreclosure Mediation Program.
Tags: foreclosure, Foreclosures, new jersey foreclosures, stopping foreclosures
Posted by
admin on Feb 2, 2009 in
Announcements,
Foreclosures Fannie Mae and Freddie Mac on Friday again extended their moratorium on evictions of borrowers or renters facing foreclosure through Feb. 28. The companies also announced plans to expand rental options after defaults and to develop a new rent-to-own program.
Details of the programs include:
- Month-to-month leases for borrowers and renters;
- Property management companies hired by Freddie and Fannie will set market-value rents;
- Tenants and homeowners will be asked to demonstrate that they have enough money to pay the rent.
“Keeping foreclosed properties occupied and in better repair will support local property values and promote a faster recovery in the housing market,” David Moffett, Freddie Mac’s chief executive officer, said in a statement.
Tags: evictions, Fannie Mae, foreclosure, Freddie Mac, moratorium
Posted by
admin on Oct 3, 2008 in
Finances,
Foreclosures,
Housing,
Mortgages Struggling families facing foreclosure will find one more avenue to take-mortgage assistance through a program called HOPE for Homeowners program, which will refinance mortgages for borrowers who are having difficulty making their payments, but can afford a new loan insured by HUD’s Federal Housing Administration (FHA).
The HOPE for Homeowners program begins today and ends September 30, 2011. The program is available only to owner occupants and will offer 30-year fixed rate mortgages, so the borrower’s last payment will be the same as the first payment. In many cases, to avoid what would be an even costlier foreclosure, banks will have to write down the existing mortgage to 90 percent of the new appraised value of the home.
If you are interested finding out more or in attending a planned seminar on this new program, call Linda at 609-417-1084 for details.
Tags: financing, foreclosure, HOPE for Homeowners, mortgage
If you are a homeowner facing foreclosure, you’re probably suseptible to knee-jerk reactions and feel undue pressure to take any kind of action. More then likely you have no money, you’re late in paying your bills, and you are receiving one notice after another from your mortgage lender dunning you that if you don’t do something right away that they are going to take possession of your home from you. What options do you have?
You have numerous options. Take time to step back and look at your situation with an objective eye. Don’t allow anyone to “force your hand” and cause you to react with a course of action that is not in your best interest. Depending on your situation, not all of the options below will be available to you. But it’s very likely that at least some of them may be. One of the first things you should do is contact the mortgage lender that holds your mortgage to discuss your options. One of the worst things you can do is avoid your mortgage lender and not discuss your situation with them. As uncomfortable as this may be it is definitely less uncomfortable then being evicted by the sheriff.
I. If you really want to stay in your home and are willing to work hard to keep it, you probably have some options that will allow you to do this -
Option 1: You can reinstate the mortgage. If you have the ability to borrow the money from relatives or friends, you can reinstate the mortgage by catching up on missed payments along with any interest, penalties, and fees your mortgage Lenderhas applied to your account.
Option 2: You can refinance. If you have equity built up in the property, you can consider refinancing the current mortgage to reduce payments and if you have credit card debt, you may be able to consolidate all your debts into a single monthly payment. This single monthly payment may be less than the total payments you are currently making. The timing for this option is critical. If your financial situation has degraded to the point of negatively impacting your credit rating, this may not work for you.
Option 3: You can try to negotiate a forbearance. Your mortgage lender may be willing to set you up with a payment plan that lets you to catch up on your payments. Just a word of caution here…be careful that the payment plan is affordable (so you don’t end up in the same situation a few months down the road). This option would be for someone who is experiencing some short-term financial setbacks and can maintian their normal mortgage payments if not for those short-term financial setbacks.
Option 4: You can sell your home to an investor and then buy it back at a future time. This is a serious option if you are running out of time. You may be able to sell your home to an investor and purchase it back with a lease-option agreement or a land-sale contract. With a lease-option agreement you rent the property for a fixed period of time. You would have the option to buy the property back at the end of that time. With a land-sale contract, you exchane who you make payments to , you’d make payments to the investor who purchased the property rather than to the mortgage lender. In both cases, you would need to sign a contract that almost always has a forfeiture clause stating that you lose the house and everything you paid on it if you do not honor the agreement, very similar to what you have with your current mortgage lender. So, depending on your financial situation and the cuases of it, check with your attorney before signing anything having to do with these type of transactions. The flip side of this option is to sell to an investor and rent the property from them. If the investor is buying the property for long-term income, they may be willing to rent it back to you. The advantage to them is that they already have a tenant for the property. You would have had proven to the investor that you had and will properly maintain the property. This option is an excellent one if you have kids in school and need several months or even a year or two to get them through school before moving.
Option 5: You can redeem the property after the sheriff’s sale. Your have to watch your time fences with this option. There are many states that have a mandatory redemption period. During this redemption period you can purchase the property back from whoever bought it at the sheriff’s sale. You would have to pay the buyer the amount that they paid plus interest and any qualifying expenses the person paid (such as property taxes and insurance). To find out more details about tbhis you would need to contact your register of deeds at the county courthouse because the laws and regulations are different for each state; you would need to find out whether your municipality has a mandatory redemption period and how long it is. This option would require borrowing the money from relatives, friends, or a private investor.
II. Maybe your financial situation is such that you cannot use any of the above options or the timing of the resolution to your financial setback is not known. You may end up having to sell your home. Although, many other real estate agents by-pass discussions about ways to keep your home and move directly to selling your home (after all, that is why they are in business), we always try to look at ways that people can stay in thier homes and why we presented those options first. But, with that said, in almost 90% of the situations involving foreclosures the homeowners are best served by selling their home and finding more affordable accommodations. If the seller has equity in the home then this becomes especially true. Because if you can sell the home for more than you owe on it, you won’t lose the equity in a foreclosure. Some options you have for selling your home -
Option 6: You can put your home on the market. This is the standard process that you would hire the Realtor in your area to list your property. It’s important that you tell the Realtor that you are facing foreclosure and ask whether they would be willing to accept a lower commission (depending on the property being listed, we would definitely consider this as a way to help the seller). On the average, a Realtor will sell your home in less time and for more money than you dcould sell it for on your own.
Option 7: You can negotiate a short sale with your mortgage lender. The situation could be that you cannot sell the home for enough to break even due to current market conditions in your area (if a neighboring home in your area is selling for less then what you need to pay off your mortgage, you may be a candidate for a short sale). Under these circumstances your mortgage lender may be willing to negotiate a short sale, which means that they would accept less than the full amount owed on their loan. Mortgage lenders who hold second mortgages or other liens against the property may be more willing to do this because they would stand to lose everything if your home ends up being sold at sheriff’s sale.
Option 8: You can sell your home to an investor. This option is different then the options involving investors above because with this one all you are looking to do is to come away with some cash, after paying off the mortgage loan. The above options involve getting enough for your home to just pay off the mortgage loan. If there isn’t enough time to sell your house before it goes into foreclosure, you may opt to sell it to an investor who will pay cash and close the deal within an extremely short period of time. However, you will be looking at having to accept up to about 20% less than the market value of your home.
III. You may have no equity, little equity, or even negative equity in your house. Maybe you don’t really care about your house being foreclosed or couldn’t do anything about it even if you did care, then maybe you should consider walking away prior to being evicted. Why do this? You won’t have to be embarrassed with a forced eviction. Here are a couple of options to use in this situation -
Option 9: You can gift the house to an investor (and your problems). An investor would be in a better position to negotiate short sales with your mortgage lender to make the transaction profitable for themselves. You would have to deed the property over to the investor. It is extremely important that you consult an attorney before moving forward with this option.
Option 10: You can offer your mortgage lender the deed to your house in lieu of foreclosure. Your mortgage lender may be willing to let you “off the hook” for the mortgage loan you owe by turning your house and signing the deed to it over to the mortgage lender. Be sure that you have an attroney represent you when dealing with the mortgage lender if you choose this option. This is so the mortgage lender can’t come after you later for any shortfall.
There are some methods where you can buy yourself some additional time before your house is foreclosed. Here are a few common options -
A. You should explore filing for bankruptcy. To many people bankruptcy sounds like an easy way out of their current situation. Bankruptcy is costly and more often then not it fails to resolve anything. You can buy yourself some time but you could end up owing more later. You need to do the math and consult a good bankrupcy attorney before you decide to file for bankruptcy.
B. If bankrupcy doesn’t seem to be the way to go, hire a reliable foreclosure attorney. A foreclosure attorney specializes in foreclosure law and by simply forcing the mortgage lender and the their attorneys to follow the letter of the law, the attorney may be able to buy you several weeks, months, or even years in the house. You want to make sure that you compare the costs and benefits of this action so you don’t end up owning more than before you hired the foreclosure attorney.
Finally, always keep in mind that the absolute worst thing you when you receive a foreclosure notice from your mortgage lender is doing nothing. The first thing you should do is mortgage lender to discuss your current situation. If you cannot come to a satisfactory resolution then try everything:
1. Place your house on the market
2. Talk to a loan officer about refinancing your house
3. Discuss your situation with a real estate investor to determine if this relationship will result in a mutually satisfactory resolution
You want to come out of your current financial situation in a little better shape, so work on tightening your financial belt.
Tags: bankrupcy, Finances, foreclosure, investments, Marketplace, mortgage, Real Estate
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