Hey guys, this is Mike from Mike Buys Houses.
I have been talking a lot about foreclosure recently, and several of my conversations have started with the same basic question, which is once the foreclosure process has started, can it be stopped?
When considering this situation, there are a few options that you have if you’re facing foreclosure and you’d ideally like to stop that process. The most important thing to remember is that the bank is primarily focused on getting paid. So, as long as you think in terms of what the bank wants, this process can be fairly straightforward.
Working with the Bank to Avoid Foreclosure
Option one will be to secure yourself a loan, whether that be through someone you know or with a local bank that you have good credit with in order to allow yourself to start making payments on your mortgage.
Outside of this, you can also try and use whatever equity you have in the property, especially if the market is appreciating, to use that to secure some additional assistance with missed payments that have accrued.
The second options is going to be to request or apply for a loan modification with your bank. That will involve you reaching out to the bank and letting them know that you would like to work on making payments again, and in turn they will provide you with a loan mod and help walk you through that process. Even if an auction date has been already set, if you’re more than 37 days out from that date, then you are able to apply for a loan modification and the bank is required to review the application.
Moving On from the Property
Your next few options will require you to move on from the property in some form or fashion. For example, you have the option to try and rent out the property, so that you can potentially start collecting some cash on the property and use those funds to pay down some or all of the loans.
You can also put the home on the market with a realtor, but this will be more expensive than you may think. There are the realtor fees and closing costs, plus you may need to make some repairs and/or concessions, while still also wanting to walk away with some money in an ideal world. At the very least, you want this transaction to cover the money you owe, so you don’t have additional bills to pay once you have sold the place.
Finally, in case you don’t have a ton of equity in the property or you are within that 37 day window of the auction date, you should really reach out to us. As I mentioned at the start, I work with homeowners who are behind on payments or in arrears due to covid all the time, and we can help them get paid and make a nice profit on their home. Through creative financing, we have turned homeowners in debt into the banks themselves, earning more on their property than they would through a cash sale.
If this is something that you would like to discuss, fill out the form below or reach out at 267-984-4765.