Leaving The Home In Foreclosure
In Michigan........ if we move to another state (husband offered relocation) ....have the house up for sale......in pre foreclosure......... can they take the house then and we lose all equity? Must we stay IN the home til we can either sell it or worse comes to worse and the sheriff sale happens?
Thank you,
Hlsrom
No, there is no requrement that you stay in the house. You might try calling the lender and offering a Deed in Lieu of foreclosure-- moves the whole process along and you may even be able to negotiate releases, etc.
How much equity do you think there is to loose?
[ Edited by commercialking on Date 01/05/2006 ]
Right now......we owe $160,000 and the house is appraised at $217,000 but we have it up for sale for $209,900 ...due to the situation...the current housing market and the relocation.
So like $45,000 in equity
With Deed in Leau....we simply lose the house right? and all the equity......but owe no more fees etc?? How quickly does that happen? Is that better than trying to sell it fast for cash to an investor? How do they report that on your credit report?
THanks!
Hlsrom (MI)
There are very specific and inflexible guidelines that determine if a lender, or typically its a servicer ( if its in default its likely a "sub-servicer", a "special servicer" or a "default servicer)) can allow a Deed In Lieu Of Foreclosure.
They are not just granted on request. In fact, they are quite difficult to obtain. Only a small minority of people who are facing foreclosure are ever offered that option.
The reality is that, in spite of the fact that most people refer to dealing with lenders when they talk about handlaing potential foreclosure situations, in almost every situation one will actually be dealing with a loan servicing companty.
Even if a bank sells the loan and retains servicing rights, the actualy servicing is performed by a subsidiary or affiliated entity to the bank.
I do not know of any of the preforeclosure investing or loss mitigation educators mention that, and it is important.
These guidelines are imposed by various players the secondary mortgage market, ie; HUD, Fannie Mae, Freddie Mac, Ginnie Mae, and the contractual agreements of various Securitization "Special Purpose Entities).
The Deed In Lieu is one of a number of "Loss Mitigation" options. Each of these options have their own qualifications and guidelines. It pays a savvy pre-foreclosure investor to learn the generalities and the specifics of Loss Mitigation options.
Thank You.
SpyBoy
Its been on the market since right after Thanksgiving. So not real long. But time is ticking. So you think we should lower the price to $199,000 OR another suggestion was offer a buyer incentive? or a buyers agent incentive?
What about an auction? Do they work?
Thank you.
Hlsrom
I would definitely consider dropping your price and maybe $500 towards closing cost if your realtor thinks that is a good incentive. Not as crazy about agent incentives. If you bring to the market price you will get a lot more activity.
I recently sold a rehab. Started it at 353k once I dropped it below the 350k mark to 348k I went from a handful of showings to a new set of buyers...had a huge spike in showings and two offers. House had an accepted offer within 3 weeks. It is very important to price it at what the market will bear. Good luck!
Ok....couple of things to reply to here.... Tony... I am not familiar with what you are saying.... about the "note". I guess I figured a cash sale would result in little to none of the equity. But at least with a realtor...getting somewhat close to what the home is really worth......we could salvage about $30,000??
Again...we bought the home at $186,900 in early 2000. Its 1752 sq ft. 3 bedrooms 2 baths.... in Oakland county Michigan.... decent area. According to www.Realtor.com and what home is THIS zip code are selling for......this home should be worth around $217,000. The house across the street sold last year for $212,000 and is only 1200 sq ft. But I do totally understand about the market and about the urgency etc... I wanted to start the price at $209,900.... but the realtor said $219,900 and then we lowered it to $211,900 and now it is $209,900. As the price lowers and still with his 6% coming out and with oweing more each passing month.........yes our equity IS definitely shriking........let alone the foreclosure process coming......
How do I get in touch with potential cash buyers? Who can i trust?
Oh and what is the consensus? Can we move out during the foreclosure process? or must one of us stay in the house?
Thanks to everyone! I read all the replies. And take in all the advice. I truly appreciate it.
Hlsrom
Lots of problems with little time.
#1) Get a real estate attorney.
#2) Your realtor has to react, there are many
creative options.
#3) Call your mortgage company, ask for a second
mortgage or a L.O.C to pay off the penalties.
#4) Last resort, foreclosure, you get nothing but
bad credit.
P.S. It is your option to stay in the house of move out.
If it forecloses, the will escort you out in due time. If
you stay in the home, I am sure you will get many of
calls stating, we will buy you home. Good Luck.
Thanks Tony! I do appreciate it. Well.......nothing. We have dropped the price to $209,900 and we have had more showings.........one tomorrow in fact. But no bites thus far. And amazingly......knock on wood..........no acton on the mortgage companys part yet. I am holding my breath.........
All I know is......we need to sell it ASAP.
Thanks again,
Mary