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Legal Services for the
Small Business
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Foreclosure is the legal process by which an owner’s right to their property is terminated, usually due to default. My goal is to interrupt or stop the process and help you save your family’s home. You however need to take the first step. Your lender won't automatically put you into a program to bring your loan up-to-date. You must put the plan into motion and provide the lender with the documentation they require to analyze your financial situation to stop the Foreclosure action. Because the foreclosure is a legal process it is costly and time consuming. In most cases your lender does not want to foreclose on your home and is usually willing to agree to terms to stop foreclosure. These terms are negotiable and it is to your advantage to develop a plan of action before contacting your lender. Call me to help you develop this plan. It needs to be thoroughly analyzed before presenting it to your lender as it becomes very difficult to adjust after accepted by the lender.
The most common way of resolving a loan default is to work out a plan which will let you repay part of the delinquency each month, along with you regular monthly installment. If you experienced a short term financial hardship but you are now back on your feet but need help getting caught up, this approach may be right for you.
If you can currently make your regular payment, but you can’t catch up with the past-due amount, I will negotiate with your lender to fold any past-due amounts, including interest and escrow, into the unpaid principal balance. This new amount will be re-amortized over a new period of time. With a Loan Modification you change your existing mortgage note and get a fresh new start. Your account will be brought up to date immediately.
Forbearance gives you time to gather your assets and develop an action plan to bring your mortgage up to date. This plan works for people who have just experienced a sudden living expense increase or income loss. In Forbearance, you are allowed to delay or reduce payments for a short period, with the understanding that another option will be used at the close of that time to bring your account to a current status. Your lender, if in agreement, will then temporarily cease legal actions.
Selling your home may actually be the relief that you need. However, you’ve tried unsuccessfully for months to sell your home through traditional real estate methods. A Short Sale allows you to sell your home to a third party at a price which is less than the total amount that you owe on the mortgage. Your lender accepts a discount on the mortgage to avoid a possible foreclosure auction or bankruptcy, both costly and time consuming legal processes. Also, lenders know they could lose a lot more money if the property goes to auction. There are many fees involved if the property goes to auction. Your lender may be better off taking the discount upfront and getting a non-performing loan off their books.
A “Deed-in-lieu” may be the answer if you have been unable to make your monthly mortgage payments and have also been unsuccessful trying to sell your home at or near market value Deed-in-lieu of Foreclosure is a procedure that allows you to transfer your property voluntarily to your lender who, in exchange, may forgive your debt or deficiency. This of course will not save your home, but it will help you with your chances of getting another mortgage loan in the future and it will help you avoid the lengthy, and potentially embarrassing, legal process of foreclosure. Although it is a negative strike on your credit rating, it is less harmful than a mortgage foreclosure.
Your mortgage company may have some specific requirements that must be met prior to entering into negotiations for a deed-in-lieu. They may for example require that your home has been listed with a real estate agent for at least 30 days and there are no other liens on the property for them to approve you. Let me help you with filing the necessary paperwork and negotiating with your lender.
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