Las Vegas Foreclosure Options and Solutions for Homeowners in Distress
The current US housing market and national financial crisis have caused
untold stress and heartache for many American families especially homeowners here in Las Vegas facing foreclosure. Foreclosure is one of the most devastating financial challenges that a family can face
and one that many times can be avoided. The options to avoid foreclosure
for Las Vegas homeowners are many, following is a brief explanation of some of the options available to Las Vegas Homeowners in distress. Now more than ever, it is important for you to understand these options to find the best solutions for you.
REINSTATEMENT
A reinstatement is the simplest solution for a foreclosure, however it is often
the most difficult. The homeowner simply requests to know the total amount
owed to the mortgage company to date, and then pays it. This solution does
not require the lender’s approval and will ‘reinstate’ a mortgage up to the
day before the final foreclosure sale.
FORBEARANCE OR REPAYMENT PLAN
A forbearance or repayment plan involves the homeowner negotiating with
the mortgage company to allow them to repay back payments over a period
of time. The homeowner typically makes their current mortgage payment in
addition to a portion of the back payments they owe.
MORTGAGE MODIFICATION
A mortgage modification involves the reduction of one of the following:
the interest rate on the loan, the principal balance of the loan, the term of
the loan, or any or all of the above. This typically results in a lower payment
for the homeowner and a more affordable mortgage.
RENT THE PROPERTY
A homeowner with a mortgage payment low enough that market rent
will allow it to be paid can convert the property to a rental and use the
rental income to pay the mortgage.
DEED IN LIEU OF FORECLOSURE
Also known as a ‘friendly foreclosure’, a deed in lieu allows the homeowner
to return the property to the lender rather than go through the foreclosure
process. A deed in lieu requires lender approval and requires the homeowner
to vacate the property.
BANKRUPTCY
Bankruptcy has been marketed by many as a ‘foreclosure solution’, which it
can be in some states and specific situations. If the homeowner has non-mortgage
debts with payments causing a hardship—to the homeowner falling short of paying
the mortgage payments, and personal bankruptcy will eliminate these debts - this
may be a viable solution.
REFINANCE
If a homeowner has sufficient equity in the property and his/her credit is
still in good standing, a mortgage refinance may be an option.
SERVICEMEMBERS CIVIL RELIEF ACT (MILITARY PERSONNEL ONLY)
If a member of the military is experiencing financial distress due to
deployment and that person can show that their debt was entered into prior
to deployment they may qualify for relief under the Servicemembers Civil
Relief Act. The American Bar Association has a network of attorneys that will
work with Servicemembers in relation to qualifying for this relief.
SELL THE PROPERTY
If a homeowner has sufficient equity in the property, they can list the property
with a qualified agent that understands the foreclosure process in their area
and sell their property.
SHORT SALE
If a homeowner owes more on their property than it is currently worth, then
they can hire a qualified real estate agent to market and sell the property through
the negotiation of a short sale with their lender. This typically requires the property
to be listed on the market, and the homeowner must have a financial hardship to
qualify. Hardship can be simply defined as a material change in the financial stability
of the homeowner between the date of home purchase and the date of the short sale
negotiation. Acceptable hardships include, but are not limited to: mortgage payment
increase, job loss, divorce, excessive debt, forced or unplanned relocation, and others.
BENEFITS OF A SHORT SALE
- Allows homeowner to avoid foreclosure and salvage some of their credit
- rating card. Keep a foreclosure off the public record for an individual. In many
- cases will allow homeowner to avoid a deficiency judgment. Borrower may
- qualify for another mortgage in as little as 24 months (5 years for foreclosure).
- Short sales can be trying process in which a homeowner is best served by
- contracting with a qualified real estate agent to guide the way.
This represents only a summary of some of the solutions available to homeowners facing
foreclosure. Please call me today for a free confidential evaluation of your individual
situation, property value and possible options.
Makea Turner Keller Williams Realty Southwest (702) 542-1883 or visit
www.AvoidLVForeclosure.com
