There are very few things as stressful as losing a home to foreclosure. You and your family have likely enjoyed living in the home for a long time and put a lot of time and effort, not to mention money, into the home. And now, due to unforeseen circumstances, you may lose the property.
For local families facing foreclosure, the stress can be almost unbearable. Worse yet, the foreclosure process can take months or even years, stretching out the pain for longer than anyone wants.
Fortunately, you have options available to you here in — perhaps more options than you realize. There are many strategies that help for foreclosure in Kansas City; these are legal foreclosure avoidance strategies you can implement to help you resolve your foreclosure issue so you can get on with your life.
In this blog post we’re going to be discussing 3 strategies to avoid the foreclosure legally and ethically. While not every strategy may not work for you, you’ll likely find at least one thing that wil. d
Strategy #1: Work out a deal with your lender
The first strategy is called a “foreclosure workout”. In a foreclosure workout, you’ll sit down with your lender and tell them that you don’t think you can pay your current mortgage obligation but you’d like to figure something out so you can stay in your house and continue to pay your mortgage.
Contrary to popular opinion, the lenders don’t want to go through the foreclosure any more than you do. They are in the money lending business, not the real estate business and would prefer to have you in the property making regular payments. Therefore they will often do a loan modification. They may move your outstanding payments to the end of the loan, restructure the debt to get lower monthly payments, or stretch out the existing payments over a longer time to help you get caught back up.
Strategy #2. Bankruptcy
Filing for bankruptcy may seem like an extreme measure but it is one of the “tools” in your foreclosure avoidance toolbelt. When you file for bankruptcy, you let all of the creditors know that you are no longer capable of paying off your debts. This will stop the foreclosure process because creditors have to stop collections until the bankruptcy is resolved.
Filing for bankruptcy, though, is a little extreme: it may require you to sell off some of your assets in order to pay off your creditors. And, a bankruptcy will remain on your credit score for many years, which could impact everything from getting a loan to getting a car… even getting a job. So this shouldn’t be your first line of defense!
Strategy #3. Short sale help for a foreclosure in Kansas City
Selling your home via a short sale is a great strategy and our third option. In this situation, you work with the bank to sell the property and put whatever money is made towards the loan. The bank will then close the loan, even if the money is less than what is owed. This strategy is preferred because it is simple, straightforward and can be fast.
- It’s proactive, which means that you take matters into your own hands (that’s a major stress eliminator because so much of the stress of foreclosure comes from the process being completely out of your control).
- It’s fast — in some cases, you can sell your home in as little as a week! That’s also because it’s local: You can get help for foreclosure in Kansas City since organizations like Fair Home Offer KC help people going through short sales.
- It’s very effective because a short sale can completely wipe out (or almost wipe out) the amount owing on your mortgage. If there is any amount left over that is not covered by the sale of the property, you’ll be responsible for it (although you can sometimes work out a deal with your lender).
With a short sale, you still end up with the reality of having to leave your home but there is a bright side: The impact to your credit is much less (compared to a bankruptcy or a foreclosure) so this is a smart long-term play to give yourself some options.