Being faced with the possibility of foreclosure is a scary experience. Individuals can become unsure about what the future holds and how they will be able to shelter themselves and their families. However, there are a few ways that individuals may be able to save their home from foreclosure.
One way to stop the foreclosure of your home is by filing for bankruptcy. The two forms individuals can use are Chapter 7 bankruptcy and Chapter 13 bankruptcy. Through these two bankruptcy processes, an automatic stay goes into effect. Not only does this prevent creditors from reaching out, it also can prevent foreclosure.
Although bankruptcy may seem like a negative process for people, it can prove to be effective. It should not be avoided at all costs. Instead, individuals should use this process when they have no other options available to them. Bankruptcy can help to save your home, ban contact with creditors and develop a better plan for the possibility of a more successful financial future. Both processes are fairly similar and have benefits to them.
What is a short sale?
A short sale is when a lender agrees to take a loan payoff that is less than the value of the mortgage. Although this can impact an individual’s credit, it may not cause as many negative effects as filing for bankruptcy or facing foreclosure. If debt concerning your estate has become overwhelming, this can be a good option to improve your situation. The pressure to pay your required costs may seem less overwhelming.
What is the process for a short sale like?
Before a short sale goes is guaranteed, it must be approved by the lender. Once it is approved by the lender, the seller cannot receive any of the proceeds. Instead, the closing costs are paid by the bank. If there is evidence showing that you can afford your mortgage, the lender has the right to deny your request for a short sale.
During the process of a short sale, there are many factors that can impact the success. If there are multiple loans, one of the lenders for that loan may reject the payoff that is being offered to them. This can set the whole process off target. Other impactful factors can include mechanic’s liens, outstanding homeowners or association dues, tax liens and liquid assets that can cover the shortage of the loan. It is important to keep all this in mind to prevent any unwanted circumstances.
If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options.