Everyone will face hard times in life. You are not alone. Loss of a loved one, unemployment, health issues, death and divorce can show up at anytime. When these things happen, most families are only slightly prepared. The costs are astronomical.
Trying as hard as you can to keep current on payments can only last for so long. Eventually you’re going to need help. Your lender is a debt collector and to them, you are only a loan number who owes them money.
If you are going through a hardship, you need a plan. Here is some basic and important information you can use.
1. Contact your lender immediately.
Let them know what’s going on and what you are dealing with and how you are working to resolve the issue. Ask if they have any programs that can help you. Get a spiral bound note pad and document the number you called, who you spoke to, the time that you spoke and details of the conversation. Your call log is admissible in court if you have legal issues in the future. HUD states that less than 10% of homeowners attempt to contact their lender or request help before the home is foreclosed upon and eventually sold. Don’t fall into this group. If you feel like you’re getting nowhere fast, the next step will help.
2. Call a Realtor Who Specializes in Assisting Distressed Seller’s.
Many home owners think that just any Realtor can help. That is not true. You need to know your options. Modification, forbearance, Deed in Lieu, Short Sale or Market sale all have different ramifications depending on the type of property, the amount owed, the type of financing, and your families needs. The process is complicated and you’re going to need someone with experience and knowledge to help you develop a plan. Now is not the time for your Realtor to learn how and what to do. You need a professional FAST.
3. Get your Finances in order.
If you intend to keep the home, you’re going to need some assistance. Unless you have the money to immediately come current on the loan, you’ll need to qualify for assistance. The process is a lot like applying for a loan. They will require bank statements, tax returns, W2s and documentation on what is happening on your end. Many lenders have specific forms that they use to collect this data. This again is where working with a great Realtor who knows the process will help you tremendously. They can fax, scan, email, or transmit all necessary documents while keeping a call log and communicating on your behalf. If you’re lacking some of the items they require, there is still hope. The process is more complicated and you’ll again want a professional to prepare your assistance request.
4. Look out for scammers!!!!
The Notice of Default that your lender sent you is public record. It’s also a huge flag for scammers who will call and offer to help you negotiate with your lender for a fee. DO NOT PAY THEM! Kevin Cross with Foundations Real Estate Experts offers FREE consultations to help you develop a plan. His team can be reached at 907-865-6529. Save your money for getting current with your lender, applying towards a modification or as a parachute on the other side of a short sale.
Here is what is comes down to. If you cannot afford to make some sort of reasonable payment to your lender, you will have to sell it. If you do nothing you will lose any equity you may have. If you don’t have a competent Realtor who knows how to negotiate with your lender, you may not get it sold in time and the bank may take the home. If you owe more than the home is worth, the debt can be forgiven if you know the process. Regardless of the path you choose, you’ll need a Realtor experienced in the process to do this.
About the Author:
I’m Kevin Cross, owner of Foundations Real Estate Experts of Keller Williams. I entered real estate in 2007 as the market was falling and quickly mastered the art of Loan Modifications, Deed in Lieu and Short Sales. I specialize in helping families avoid foreclosure, protect their credit and equity. If you are not sure where to turn, I’m here to help. At a weak moment, don’t hire a weak Realtor.
Owner: Foundations Real Estate Experts, Keller Williams
2012 President Anchorage Board of Realtors
2009-2016 President Real Estate Exchange
2015-2016 Anchorage Platting Board
Certified Distressed Property Expert