There are many stressful situations that lead homeowners to losing their house. One of the most common reasons is due to foreclosure. To make it simple, foreclosure is the action of taking back a property due to non-payment of a debt or loan. A mortgage is a loan that you take out from a lender to buy a house, piece of property or land. It is considered a legal document in which you are responsible of paying it back.
Options for Homeowners with a Mortgage
If the mortgage is not paid, homeowners are given options to help them before the foreclosure process starts, known as pre-foreclosure. Normally, the first step for homeowners is to contact the U.S. Department of Housing and Urban Development. By requesting to speak with a Housing Counselor, they are then able to learn about the options for homeowners with a mortgage, such as:
Refinancing – Replacing current mortgage with a new one.
Forbearance – Agreement with lender to bring past-due payments current.
Loan Modification – Agreement with lender to reduce monthly payments by changing original loan terms.
Repayment plan – Spread past due amounts onto current monthly payments, over-time, until mortgage is current.
If none of these options work, an alternative solution is having a Short Sale.
What is a Short Sale?
“What is a Short Sale” you ask? This type of sale involves selling your house for less than what is owed on the mortgage. By having a short sale, you avoid any impact on your overall credit. Normally, homeowners would hire a real estate (sellers) agent to guide them through the short sale process. Since this type of sale is dependent on getting the short sale approved by the lender, there is no guarantee that the house would be sold for less than what its’ worth. Plus, you still need to negotiate a sellers’ agent commission fee & pay any other possible closing cost when selling the house.
What are Property Taxes?
Real Estate Tax (also known as Property Taxes) are charges onto homeowners by local government for the use of real estate. In Massachusetts, the local town or city hall has assigned treasurers to collect property taxes. By not keeping up with property taxes, the treasurer will move forward with a process called Tax Title Taking, also known as placing a Property Tax Lien. A lien is a legal claim that is filed against a property for unpaid debt or work. If and when a lien is placed, it is just a matter of time when you will receive a summons to attend Land Court, where the town will request payment for property taxes be made in full or they will be forced to foreclose (take over the title) of your property.
To avoid foreclosure, due to unpaid property taxes, there are two separate applications that Massachusetts homeowners can fill out and submit, a deferment(payments are deferred until property is sold or homeowner passes away) or exemption(all or portion of payments, for the fiscal year, are discharged from the homeowners legal obligation of paying it).
Those who qualify for an exemption are:
Surviving Spouse, Minor Children &/or Elderly Persons
While those who qualify for deferral are:
Going through Financial Hardship
Renting or Selling a Pre-foreclosed House
There are two last options for foreclosure help, which include renting or selling your house fast for cash. Renting your house allows you the opportunity to collect monthly rent from tenants that can be used towards paying down the mortgage. This responsibility is called becoming a landlord. Selling your house fast for cash is essentially what we do best. We buy homes from distressed Massachusetts homeowners in the pre-foreclosure process.
We DO NOT buy all homes in foreclosure as we must learn more about the homeowners situation, how much equity exist in the property, if any, and where in the foreclosure timeline is the homeowner in. When you submit a request form, we will contact you to ask specific questions about your stressful situation. If and when you meet our buying criteria, we will set up a home visit. Within 24 hours, we will then present you with a reasonable cash offer. That simple! Not sure if you are ready, read our How We Buy page to learn more about how it works.