With millions of homes across the country going into foreclosure, it’s important for both buyers and mortgage holders to understand the process. This understanding can make it easier to find a path forward.
So what is a pre-foreclosure in Raleigh, Durham, Wake Forest anyway?
Many homeowners across America and Raleigh, Durham, Wake Forest are facing difficulties making their monthly mortgage payments. Loss of jobs, downsizing, increasing interest rates, and inflation are all contributing factors.
When a homeowner misses 3-6 months of mortgage payments, the lending institution will issue a warning, notifying the homeowner to pay or lose their home. This period is known as “pre-foreclosure.” It is important to keep lines of communication open with the lender at this time, especially if you can work out a deal with them.
Banks and mortgage lenders typically provide three months for the homeowner to become current. Of course this number can vary by bank and situation sometimes.
If a homeowner fails to make the necessary payments, the bank will foreclose on the home, assuming ownership, and evict the homeowner. Thankfully, during this stage of the foreclosure process, a mortgage holder has the opportunity to take advantage of several options to prevent losing their home.
Pre-foreclosure Options for Borrowers
If you’re behind on mortgage payments, you’re likely to receive a “notice of default” from your mortgage lender.
This document will state that you have not made mortgage payments for the last 90-180 days. It’s important not to panic.
You have options that can delay or even prevent losing your home:
- If your mortgage is “above water,” (meaning you have equity in your house) you may be able to refinance your mortgage, receiving lower monthly payments. Check with your local Raleigh, Durham, Wake Forest mortgage broker… or contact us and we can connect you with a reputable one.
- You may be able to quickly sell your home to a real estate investor that’s reputable in Raleigh, Durham, Wake Forest like us at Coastal Oak Ventures, using the cash acquired to pay the months of back-payments owed (or we *may* be able to work out something with the lender that relieves all or part of your back payments. We can buy your Raleigh, Durham, Wake Forest NH area home quickly, often in just a week or two, will pay in cash, and takes the stress out of trying to find a buyer.
- You can contact the bank and ask them to permit a short sale. In a short sale, you’ll sell your home for less than it’s worth, and the bank will take the loss as a tax write-off. In some short sales you may still be required to pay the difference to the bank if the house doesn’t sell for what is owed on the loan.
- You may be able to declare bankruptcy, which can buy you time to pay your debt. Bankruptcy will remain on your credit report for years, and can cause significant damage. They can appear on your credit for up to 7 years and in your banking/mortgage history for 10 years.
Lenders are very much aware of the widespread financial troubles across the country and they’re willing to work with borrowers a lot of the time.
If you’re honest and communicate with your lender, you’ll often find that there are options that will allow you to remain in your home, or at least salvage your credit rating.
A foreclosure can often negatively affect your credit score by 200-400 points and can prevent you from obtaining a loan of any sort for 5-7 years, so be very dutiful if you’ve received a Notice of Default from your lender.
But if you’re not able to find a solution with your lender working directly with them… connect with us. We may be able to help.
Ways We Can Help If You’re In Pre-Foreclosure
- We can potentially help with a short sale – Submit your info on this website so we can evaluate your situation to see if we can help.
- We can buy your Raleigh, Durham, Wake Forest area house – We buy houses in Raleigh, Durham, Wake Forest and would love to make you an all-cash offer on your house too. Just fill out the form here to get started >>
- You can ask us questions and we can provide you FREE guidance and resources so you can make a well educated decision. This costs you nothing, there’s absolutely no pressure, no obligation… just free guidance without a catch.
If you’re in the pre-foreclosure stage… you’ve still got time to fix this situation.
We are not a lawyers, but we can offer some general information that might help you explore options if you’re facing foreclosure in North Carolina. It’s crucial to consult with a legal professional for advice tailored to your specific situation.
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Communication with Your Lender: Contact your lender as soon as you realize you may have trouble making mortgage payments. Explain your situation and inquire about possible options. Some lenders may be willing to work with you to find a solution.
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Loan Modification: A loan modification involves changing the terms of your mortgage to make it more affordable. This could include lowering the interest rate, extending the loan term, or adding missed payments to the loan balance. Your lender will have specific criteria for eligibility.
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Repayment Plan: Some lenders may allow you to create a repayment plan to catch up on missed payments. This involves paying extra each month until you are current on the loan.
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Forbearance: Forbearance is a temporary pause or reduction in your mortgage payments. This may be an option if you’re facing a short-term financial hardship.
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Legal Assistance: Consult with an attorney who specializes in foreclosure defense. They can provide advice based on North Carolina’s foreclosure laws and may help you understand your rights and potential legal defenses.
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North Carolina Housing Finance Agency (NCHFA): The NCHFA offers foreclosure prevention counseling services. They may be able to provide guidance and resources to help you navigate your situation.
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Mediation: North Carolina law requires lenders to offer mediation to homeowners facing foreclosure. Mediation can provide an opportunity to negotiate with the lender and explore alternatives.
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Sell the Property: If selling the property is an option, it might help you pay off the mortgage and avoid foreclosure. Be aware of the time constraints, as the process may take time.
Remember, the specific steps and options available to you can depend on your individual circumstances, the terms of your mortgage, and North Carolina state laws.
Just connect with your bank to see if they’re willing to work with you… or contact us if you’d like to see what we can buy your house for or to tap into our free foreclosure foreclosure resources.