What is a Foreclosure Auction?
With the constant hustle and bustle of life, you may find yourself in a situation where you can no longer afford to pay for your home. If this situation does arise, it is best to avoid a foreclosure auction. A foreclosure auction occurs when the homeowner fails to pay their mortgage or cannot pay any withstanding debt. The owner must forfeit all rights of the property to a lending institution. The lender could potentially make a profit from the sale due to the foreclosure. The only way for a lender to receive their money back is to market the property at an equal price of the accrued debt. If there is any profit made, the money will go to the homeowner. However, the lender will most likely let go of the house because of the outstanding balance.
Why Do you Want to Avoid Foreclosure Auction?
When faced with a foreclosure auction, it is important to take the right steps to avoid the situation overall. If you are faced with the foreclosure auction, then you will not have any control of anything in the sale of your home. You will be restricted from making decisions or actions that you may want to make for the house. Additionally, your credit score could be affected drastically.
In this situation, you will find yourself under extreme stress and difficult challenges. It can affect your financial status, and there is a greater chance that you will lose your biggest asset which is your home. There are a few tips that can help you avoid entering in a foreclosure auction.
Ways to Stop Foreclosure Immediately
Inquire about a foreclosure sale date extension. (FDE) This is one of the ways to prevent losing your house.
What is a Foreclosure Date Extension? (FDE)
One of the ways to stop a foreclosure is to apply for an FDE. An FDE is used to delay the foreclosure of your home. It is an attempt to modify your loan and extend the sale date. However, there are circumstances where an extension of postponement is not available. Going into a foreclosure is not an easy situation. Foreclosure should not be taken lightly but you can still try your best to save your home before it is too late.
Foreclosure Delay Tactics
Recognize the Signs
You should be aware of and be able to recognize if you are undergoing financial difficulties or setbacks. While you are still in control, it is important that you take the necessary steps to sell your house immediately. Instabilities in your finances, payments or credit could be grounds for an immediate foreclosure. You must think and act wisely.
Look for Technicalities
Look for flaws or technicalities in your mortgage documents, this can be your chance to buy a little extra time before going into a foreclosure. Irregularities in these documents could help you to prolong the foreclosure and your lender may take time to produce a new document. However, remember this does not stop a foreclosure from happening, it only delays the inevitable. This is just a tactic to delay the process.
Count on Delays
It will take some time for the foreclosure process to complete and close out. In some states, the foreclosure is effective immediately. There is important paperwork that needs to be completed and this is a chance to take your time. You could wait until the furthest deadline to send in the correct paperwork.
Raising Arguments
If delaying the paperwork did not work or turn out favorably, you can begin to raise arguments. This method involves arguing with the lender that the foreclosure should not transpire. This delay tactic will only buy you a little amount of time. Do your research before you bring up an argument about the foreclosure.
Consider Bankruptcy
Bankruptcy is another option that you consider if you want to delay the foreclosure auction. This will affect your credit score and it will delay the foreclosure. You will not be able to keep your home unless you have made an agreement with lenders involving your home.
What are your Options?
You have a few options when it comes to avoiding the foreclosure of your house. Here are a few methods to consider:
Hire an Agent to Sell
While this may sound like a good idea at first it may not work out in your favor. There are 2 things that will complicate and may even cost you your home when it comes to selling a pre foreclosure with a real estate agent.
1) Agent Fees
In a typical real estate transaction you can expect to lose 9% of the house through real estate and brokerage fees. This is only one facet to being held back through fees. You may also incur lender required repairs, offers no where near the asking price, concessions from potential buyers. If you have very little equity this can be a huge problem when it comes to selling your pre foreclosure and you may end up having to come out of pocket to get the home sold.
2) Time
Usually when pre foreclosure paperwork hits there are about 3 months before the actual foreclosure. On average most homes sit 2-3 months before being sold (if they are priced right) through a realtor. This means that your home may be foreclosed upon before you are able to complete the sale of the home. In situations like this you need as fast a close as possible.
Avoid Foreclosure Auction with a cash sale
One of the best solutions is to sell your house for cash. When you sell your house for cash, it will close fast and leave you with the most amount of money in your pocket. Cash buyers in the Austin area like Keller Home Solutions can work to make sure that your credit and finances are kept in tact by avoiding the foreclosure with a cash sale.
If your house is sold at the foreclosure auction, then it will reap less than or even equivalent to how much you owe. You will not be in control of the price of the house. Your credit will be ruined. This may even affect your job (security clearance etc). If you sell the house for a cash sale, it would be a lot less stressful and you have control of the sale price.
The cash sale is a simple yet effective procedure to help you avoid foreclosure. If you sense that you are at risk for foreclosure, use this option. This option will give you a sense of control and you will receive cash. You will be planning for your future and will have a set closing date on the sale of your home.
Do You Want to Avoid a Foreclosure Auction?
A foreclosure auction on your home may be adding fear and unwanted stress in your life. We are here to help you with any questions you may have about the foreclosure process. At Keller Home Solutions, we help because we care. Are you ready to sell? Contact us today if you have any questions.