“I’m behind in payments…will I be giving my house back to the bank in Kansas City?”
No one wants to lose their home! For many people, their home is their greatest source of pride and comfort. But sometimes life can go against you and the financial burdon of homeownership can be more than you can take on at the moment.
If your situation progresses too far, you may be forced into the unfortunate situation of having to give your house back to the bank in Kansas City Missouri, leaving you temporarily without a place to stay. In addition, there may be long-term consequences, including a dramatic and long-lasting impact to your credit (and your ability to get a house in the future).
This is of course not a great situation and one that you definitely want to avoid. But don’t lose heart. There are strategies to prevent most of the impact of this event and move on quickly to set yourself up for future success quickly!
Here’s a brief overview of the foreclosure process
The foreclosure process can vary depending on location and the type of mortgage you have.
Usually, if you miss a few mortgage payments, your loan company will start sending you notifications and then warnings. Eventually, if you don’t pay the back balance or work out a payment plan with the lender, the bank will take the home and sell it on the auction steps.
The amount of time that you will be able to stay in your home depends on the state you’re living in. Eventually though you will need to find another place to live.
Fortunately, you have options!
If you wait until your home is foreclosed, it can have a devastating effect on your credit rating. One option to protect yourself is to work out an arrangement with the loan company called a “deed in lieu of foreclosure”.
Essentially you just agree to give up the deed and any rights to the lender in exchange for them not having to go through the whole foreclosure process. The lender gets to save money on the legal fees and you in turn get to save your credit from being trashed.
You can also avoid foreclosure by selling your house before it’s lost at the auction. If your loan is paid in full then there will be no more penalties against you and your credit rating. (If your loan isn’t paid in full you will need to make up the shortfall).
Here’s an example: Let’s say you owed $100,000 on your home and you sold your home to us for $90,000. You would give that money to the loan company, along with $10,000 to make up the short-fall, and your loan would be paid off. (If you contact a real estate attorney, you may be able to negotiate a deed in lieu of foreclosure deal in which the loan company agrees not to go after the difference in exchange for the deed to the house.
At Green Sparrow Properties, we’re professional real estate investors. Contact us today at 816-800-9238 to find out what we can offer you for your house — even if it needs repairs.
I want to avoid giving my house back to the bank in Kansas City!
So why do people sell their home instead of going through foreclosure? (After all, they still don’t live in their home anymore.)
Well, losing a home can be difficult but the impact on your financial situation and your credit is considerably less than if you simply wait out the foreclosure process. In many cases you can end up with money IN your pocket after the sale of the home so you can start things off from a strong position. Going through foreclosure could impact your credit score by as much as 100 to 150 points. So the short-term challenge of selling your house is still a better choice than the long-term pain of giving your house back to the bank.