“I’m behind in my mortgage payments…will I be giving my Sacramento house back to the bank in Sacramento?”
Nobody wants to lose their home. But sometimes financial circumstances turn against you and those financial commitments become simply too much to manage, like your mortgage payments.
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 Sacramento, 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).
No one wants that. That’s not an ideal outcome. Fortunately, there is a strategy you can take today to help you proactively protect yourself and get back on track to financial solvency.
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. Over time, if you fail to pay back the mortgage payments you missed, the loan company may put your home up for public auction.
How long you can stay in your house after it is sold in auction depends on the state where you live. At some point, however, you will need to find a new place to stay.
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”.
This is when you hand over ownership of the house to the loan company so that they save the money they would spend on foreclosure proceedings, which can be significant. And you get to avoid having a foreclosure listed on your credit rating.
You can also avoid foreclosure by selling your Sacramento 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 North Valley Home Buyers, we’re professional real estate investors. Contact us today at (916) 500-7355 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 Sacramento!
When faced with the prospect of losing their home, some homeowners may wonder why they should bother with selling it instead of going through foreclosure, especially if they no longer reside in the property. However, the truth is that choosing to sell your home can have a much more positive impact on your financial situation and credit score than simply waiting for the foreclosure process to play out.
While losing your home can be an emotionally trying experience, it’s important to consider the long-term consequences of foreclosure. Foreclosure can have a significant negative impact on your credit score, potentially lowering it by 100 to 150 points. This can make it much more difficult to secure loans, credit cards, or even rental agreements in the future.
On the other hand, while selling your home may present some short-term challenges, it ultimately allows you to take control of the situation and potentially minimize the negative impact on your financial situation and credit score. By selling your home, you may be able to avoid the foreclosure process altogether, or at the very least, minimize the damage to your credit score.
Additionally, selling your home may allow you to recoup some of the equity you’ve built up in the property, which can help you move forward and potentially purchase a new home in the future. It also provides you with a sense of closure and the ability to move on from a difficult situation.
In short, while selling your home may present some initial challenges, it’s ultimately a better choice than allowing the foreclosure process to play out. By taking control of the situation and potentially avoiding the long-term negative consequences of foreclosure, you can protect your financial situation and credit score, and move forward with confidence.