Is Pre Foreclosure the Answer to Foreclosure Homes?
So many Americans and people globally are losing their property because of foreclosure annually. Some lenders aren’t diligent to check the person’s ability to make repayments and others simply don’t care. There are circumstances of course wherein there is a sudden turn of events towards the life of a person leading to their inability to pay for their mortgage.
No matter what the cause for client to lag on payments, the process from that point is set. What the lender will do first is file for a public default notice. This is going to initiate the process of foreclosure and it is at this point that the property enters pre-foreclosure stage officially. So if we look at it closer, pre-foreclosure is more like giving the homeowner a grace period to settle things.
This is going to set a reminder to the homeowner that they’re already in default and they should start taking actions. If for this, the lender would not have the authority to claim the property and sell it to recover the costs. The duration of grace period will vary depending by the state laws. Some states have a grace period lasting for 6 months but in most cases, the grace periods are shorter than this. Right after the property has entered pre-foreclosure, there are numerous ways that homeowners can avoid facing foreclosed property and be sold by the lender. And two of the most common options are discussed in the next paragraphs. If you want to learn more about it, I suggest you to keep on reading.
Number 1. Pay off the default – however, the property will be removed from pre-foreclosure in the event that the homeowner wasn’t able to settle the default amount. If the default amount is just small and that it was just caused by a temporary glitch, it can be worthwhile to take out a personal loan for repaying the debt. If the problem is ongoing, this may just open up more issues for the homeowner.
Number 2. Sell the house – this is a bit more drastic move but probably, it’s the best solution that you can do if you can’t meet the repayments. You as a homeowner will be able to get reasonable prices by selling it. Waiting for the lender to sell the house on the other hand is not a good idea as the sale price will be lower. This is because of the fact that by doing so, it lets them to sell the house as fast as possible.
While there are options for you to avoid foreclosure, still it will be recommended that you make your best efforts to not get to this point.