11 Options for a Central Ohio Home Owner Facing Foreclosure
After the housing market bubble burst a couple of years ago, foreclosures became increasing common on real estate markets everywhere - including the Central Ohio real estate market.
However, many Central Ohio home owners facing foreclosure don't realize that they have several options from which to choose when it comes to addressing a possible foreclosure.
Continue reading to learn about the top 11 options that Central Ohio home owners have when facing a foreclosure.
Pickerington, Ohio Area Foreclosure Options
Are you a Pickerington, Ohio area home owner facing foreclosure? Have you considered the following options?
- Re-Instatement. Up to the day of the court house sale, you have the option of catching up on the payments for your Central Ohio home in arrears to stop foreclosure. These payments include back payments, late fees and court costs.
- Forbearance or Re-payment plan. This is where you create a repayment plan with your mortgage company in order to be able to catch up in arrears. Just like re-instatement, these payments would include late fees and courts costs as well as back payments. However, these payments are usually made in smaller installments versus a lump sum.
- Refinance. Consider refinancing your home to a lower interest rate if current rates are lower than your mortgage rate and you still have a fairly decent credit score. This will take some financial burden off of you by reducing your total monthly payment.
- Rent. When you open your home to renters, you're essentially letting someone else pay your mortgage for you. Contact a Central Ohio real estate specialist such as The Pacifico Group, to learn about what similar homes to yours are renting for.
- Sell. If you're having trouble making your mortgage payments and you have equity built up in your Central Ohio home, you should sell it instead of risking foreclosure. A Pickerington area real estate expert - like the ones at The Pacifico Group - can help you determine the market value of your home so that you can get the best price for your home possible.
- Mortgage Modification. Banks would rather grant a mortgage modification than foreclose on a home. Why? Because once they foreclose on a home, they're responsible for paying for taxes, insurance, maintenance, utilities and more on that home. Thus, if you're behind on your payments, contact your mortgage company to see if they'd be willing to modify your mortgage. They'll likely be more willing to do so than you'd expect.
- Short-Refi. This relatively new foreclosure avoidance option is sometimes referred to as the Government's HOPE Program. During a short-refi, a Central Ohio home is refinanced so that the principal balance and usually the interest rate as well are reduced.
- Service Members Civil Relief Act (SCRA). Signed into law in December 2003, this law grants certain protections to military personnel.
- Deed in Lieu of Foreclosure. Also known as a "friendly foreclosure," this is where a Central Ohio home owner gives the deed of their home back to the mortgage company. Although this will still appear as a "foreclosure" on your credit report (which will, in turn, affect your credit score in the same way as a typical foreclosure), the mortgage company may decide to waive a deficiency judgment as a "Thank You" for your cooperation. After all, by volunteering to give the mortgage company the deed to your home, you're saving them money from a lengthy foreclosure process.
- Bankruptcy. This option involves hiring an attorney to file chapters 7, 11, or 13 in order to have all or part of your debt dismissed in court. Although this may delay a foreclosure, you'll likely still end up with both a foreclosure and a bankruptcy on your credit report. There's a common misconception that filing bankruptcy will just make all of your financial problems disappear. The reality is that a lending agency can still file a deficiency judgment against you.
- Short Sale. This is where you sell your home for less than what is owed on the home. Usually this requires approval from your lending institution.
Why Pickerington, OH Short Sales Are The Best Option
Short sales soften the blow that a potential foreclosure can deal to both the lending agency and the homeowner.
For the lending agency, a short sale means that they're recouping at least some of their losses. For the Central Ohio home owner, it means that their credit score will not be as severely damaged as with a foreclosure. It also means that they'll be eligible to buy another Central Ohio home for sale sooner.
Still, the short sale process can be long and complicated - especially if you're not working with an experienced Central Ohio REALTOR.
We have successfully completed plenty of short sales and understand the process quite well.
As your Central Ohio real estate experts, we'll be happy to help guide you through the Central Ohio short sale process as well.
In the meantime, we also suggest you check out some of our other helpful Central Ohio foreclosure resources, including: