Are you behind on your mortgage payments and worried about losing your house in Thornton, Northglenn, Broomfield, Lafayette, Louisville, Longmont, or Boulder Area?
No one ever plans on facing foreclosure, but sometimes financial difficulties make it hard to keep up with payments. If things go too far, you might end up giving your house back to the bank in Thornton, Northglenn, Broomfield, Lafayette, Louisville, Longmont, or Boulder Area, Colorado, which can leave you without a home and negatively impact your credit for years to come.
Fortunately, there are steps you can take now to protect yourself and avoid foreclosure.
Understanding the Foreclosure Process
The foreclosure process varies based on your mortgage type and location, but it generally begins when you miss a few payments. The loan company will start sending warnings, and if payments aren’t made, they could eventually put your house up for public auction.
How long you can remain in your home after a foreclosure sale depends on the state you live in. But eventually, you will need to move, and the long-term impact on your credit score could be severe.
You Have Options to Avoid Foreclosure
If you wait for foreclosure, the damage to your credit could be significant. However, there are alternatives to giving your home back to the bank.
One option is a “deed in lieu of foreclosure.” This allows you to transfer ownership of your house directly to the loan company. It saves them the cost of foreclosure proceedings, and you avoid the damaging mark on your credit report.
Another option is to sell your house before it goes to auction. By selling, you could pay off the loan in full, which would prevent foreclosure and protect your credit score. Even if you can’t fully pay off the loan, it’s possible to negotiate with the lender to cover the difference or explore a deed in lieu option to resolve the shortfall.
An Example of How This Works
Let’s say you owe $100,000 on your mortgage, but sell your house to us for $90,000. You would use the sale proceeds to pay the loan company and might need to cover the $10,000 difference. However, a real estate attorney could help negotiate a deed in lieu of foreclosure, where the loan company forgives the shortfall in exchange for the property deed.
At Red Crane, we specialize in buying houses, even those in need of repair. Contact us at (303) 489-5128 to see what we can offer for your home and explore your options.
Why Selling Is Better Than Foreclosure
Selling your home may not be easy, but it’s far less damaging to your finances and credit than waiting for foreclosure. A foreclosure could drop your credit score by 100 to 150 points, making it harder to qualify for loans in the future.
If you’re concerned about losing your home, selling your property is a proactive step that can save you from the long-term pain of foreclosure.