If you’re in pre-foreclosure, you’re certainly not alone. Many people have recently skipped mortgage payments, especially while the foreclosure moratorium was in effect. But you need to deal with your pre-foreclosure now before it becomes a full foreclosure. At We Buy Houses Cleveland, we buy houses. If you need to sell your house fast, we can help.
Letting Your Property Foreclose
A lot of people just give up and assume that it’s easier to foreclose. They stop paying their mortgage, walk out of the property, and let the bank handle the rest. But that’s usually not in your best interest.
Once you let your property foreclose, that foreclosure will be on your record. The damage to your credit report will make it difficult to rent another property, and foreclosure will make it difficult for you to buy another property.
Moreover, the bank is interested in selling the property as quickly as possible because it doesn’t want to maintain it. So the bank will sell the property for very little, and you won’t get any of the equity that you may have deserved.
Negotiating With the Bank
During difficult economic times, the bank actually doesn’t want to foreclose on a multitude of properties. It doesn’t want to manage them all. Occasionally, the bank can be compelled to re-age your loan. The loan payments you missed are added to the back of your loan, so it’s like your loan was “paused” for that time. If you’re in a temporarily difficult financial situation, this type of negotiation can help you get back on track with your payments.
Another thing that the bank may approve is something called a “short sale.” A short sale refers to when you sell a property short of the amount that you actually owe on the property. When you do this, the bank forgives the rest of your debt (although that means you need to pay taxes on the forgiven amount). It can make it much easier to sell a property quickly that is currently outpriced for its market.
Bankruptcy is usually a last-ditch effort. Bankruptcy is best if you just cannot pay your bills. If you have a lot of debt, especially personal loans or credit card debt, bankruptcy will resolve it. And you’ll usually be able to keep your house. The downside, though, is that bankruptcy will affect your credit even worse than a foreclosure. And if you just cannot afford your house, bankruptcy isn’t going to help.
When you can avoid bankruptcy, you generally should. It stays on your report for a long time, and it makes it even more difficult for you to financially recover. Having a lower credit score can hurt you in a lot of ways: having to put down larger deposits on rentals or utilities, not being able to rent again immediately, and not having credit for emergencies.
Selling Your House Fast
Often, the best option is to just sell your house fast. If you can sell your house, you can walk away with money and get yourself into a better financial situation. You may be able to sell your house for enough to pay off other debts, or you may be able to sell your house and switch to a home that is a little better for your budget.
At We Buy Houses Cleveland, we purchase houses in any condition. Whether they’re old, ugly, or just in need of an update, we make cash offers on houses that can be closed within days rather than weeks. That means that you’ll be able to close on the property before your foreclosure is completed. A foreclosure is a sensitive and difficult time. But you don’t need to go through it alone. Reach out online or call us at We Buy Houses Cleveland today, and we can tell you more about how you can sell your house fast and the benefits of working with us.