With millions of homes across the country going into foreclosure, it’s important for both buyers and mortgage holders to understand the process.
So what is a pre-foreclosure in Fort Myers anyway?
Many homeowners across America and Fort Myers are facing difficulties making their monthly mortgage payments.
When a homeowner misses 3-6 months of mortgage payments, the lending institution will issue a warning, notifying the homeowner to pay or lose their home. This period is known as “pre-foreclosure.”
Pre-foreclosure is the period after the homeowner has missed a certain number of mortgage payments and before the property is sold or auctioned off. During this period, the lender may send the homeowner a notice of default, which is a legal document informing the homeowner that they are in default on their mortgage payments. This notice typically gives the homeowner a specific amount of time to bring their mortgage payments current and avoid foreclosure.
Banks and mortgage lenders typically provide three months for the homeowner to become current. Of course this number can vary by bank and situation sometimes.
If a homeowner fails to make the necessary payments, the bank will foreclose on the home, assuming ownership, and evict the homeowner. Thankfully, during this stage of the foreclosure process, a mortgage holder has the opportunity to take advantage of several options to prevent losing their home.
Pre-foreclosure Options for Borrowers
If you’re behind on mortgage payments, you’re likely to receive a “notice of default” from your mortgage lender.
This document will state that you have not made mortgage payments for the last 90-180 days. It’s important not to panic.
During pre-foreclosure, homeowners have several options to avoid foreclosure and keep their home. Some of these options include:
You have options that can delay or even prevent losing your home:
- Loan modification: A loan modification is a change to the terms of your mortgage that can lower your monthly payment and make it easier to afford. This option is available to homeowners who are struggling to make their mortgage payments.
- Forbearance: Forbearance is a temporary pause or reduction in your mortgage payments. This option is available to homeowners who are experiencing a temporary financial hardship, such as a job loss or medical emergency.
- Refinance: Refinancing your mortgage can help you lower your interest rate or monthly payment, making it easier to afford your mortgage payments.
- Sell your home: Selling your home during pre-foreclosure can help you avoid foreclosure and get out from under a mortgage you can no longer afford. You can work with a real estate agent or sell your home to a real estate investor.
- Bankruptcy: Filing for bankruptcy can temporarily stop the foreclosure process and give you time to catch up on missed payments or negotiate a repayment plan with your lender.
Lenders are very much aware of the widespread financial troubles across the country and they’re willing to work with borrowers a lot of the time.
If you’re honest and communicate with your lender, you’ll often find that there are options that will allow you to remain in your home, or at least salvage your credit rating.
A foreclosure can often negatively affect your credit score by 200-400 points and can prevent you from obtaining a loan of any sort for 5-7 years, so be very dutiful if you’ve received a Notice of Default from your lender.
But if you’re not able to find a solution with your lender working directly with them… connect with us. We may be able to help.
Ways We Can Help If You’re In Pre-Foreclosure
If you’re facing pre-foreclosure, selling your home to a real estate investor can be a viable option to avoid foreclosure and get out from under a mortgage you can no longer afford. In this blog post, we will discuss ways a real estate investor can help buy a house in pre-foreclosure.
- Quick closing
One of the benefits of selling your home to a real estate investor is the speed of the transaction. Real estate investors can typically close on a sale much faster than a traditional home sale. This is especially important if you’re facing pre-foreclosure and need to sell your home quickly to avoid foreclosure.
- Cash offers
Real estate investors often make cash offers, which can be beneficial for homeowners facing pre-foreclosure. Cash offers can provide a quick infusion of cash to help pay off missed mortgage payments or other debts, which can help you avoid foreclosure and keep your credit score intact.
- No need for repairs
When selling your home to a real estate investor, there’s no need to make any repairs or renovations. Real estate investors typically buy homes in “as-is” condition, which means you can sell your home without the expense and hassle of repairs and upgrades.
- Expertise and experience
Real estate investors have the expertise and experience to navigate pre-foreclosure sales and the foreclosure process. They understand the legal requirements and can guide you through the process, making it as smooth and stress-free as possible.
- Flexible terms
Real estate investors can offer flexible terms for the sale of your home, such as seller financing or leaseback options. This can be helpful if you need to stay in your home for a period after the sale or if you need to negotiate a repayment plan with your lender.
If you’re in the pre-foreclosure stage… you’ve still got time to fix this situation.
Just connect with your bank to see if they’re willing to work with you… or contact us if you’d like to see what we can buy your house for or to tap into our free foreclosure foreclosure resources.