The story is very familiar to us; a homeowner has received a Notice of Default and wants to know what they should do next. The homeowner does not want to lose their home, however, at this stage their options are very limited. Once a Notice of Default is sent by your lender, the time has passed to be able to do a loan modification, or otherwise perform some sort of workout plan. Your options at this point are usually the following:
- Do noting – You will lose your home to foreclosure
- File for Bankruptcy – Usually delays a foreclosure, but does not prevent it
- Do a Short Sale – Allows you to purchase a home again in 2 years
No one wants to lose their home, however, in many situations it is unavoidable. The major causes of ending up in a situation include health issues, job loss and death of a wage earner. There are other situations that will lead to a homeowner being unable to pay their mortgage, but they are less common. However, at this difficult time, it is extremely important to take a mental step back from the situation, look to the future, and plot a path to financial well-being. Since the beginning of the financial crisis, we are seeing many people that have made the decision to perform a short sale, and are now, a couple of years later, have the credit and the financial ability to purchase a home again.
For more information, give us a call and we can review your situation with you to determine what the best solution for you and your family is.
