Options for your distressed property
Dealing with a distressed property is taxing on its own, but when compounded by other factors, it can be nearly impossible to deal with on your own.
When you’re staring at a pile of bills trying to make the numbers add up, it can be overwhelming. Owning a home that’s on the brink of foreclosure can be emotionally and financially draining. Whether you’re trying to get rid of your home during divorce proceedings or need to get out of the house before the foreclosure process ends, handling this type of home can be difficult. Dealing with a distressed property is taxing on its own, but when compounded by other factors, it can be nearly impossible to deal with on your own.
If you own a distressed property, you have a few options:
Apply for a loan modification or a refinance
You could ask your lender for a loan modification or apply for a refinance if you can’t make your agreed payments. You’ll need to take these steps before your home enters foreclosure proceedings. Foreclosures are expensive, and they take time. Your lender may be more likely to offer a lower monthly payment or put your home in forbearance than immediately proceed with repossessing the property.
If you want to refinance, you’ll need a good credit score to compete for lower interest rates.
Try to sell the home on the market
You could sell the home on the market if the property doesn’t require significant repairs. Even if you find a buyer, some lenders won’t loan on a property that has substantial damage. Additionally, selling a home on the market can take weeks or months. Selling a home that you inherited from a family member or a home you’re splitting in a divorce can be emotionally draining. If your home is in good shape, doesn’t require a lot of repairs, and will sell quickly, putting your home on the market could be a good option for you.
Make sure that you really know the property’s value and price competitively. Time is not your friend when you’re facing imminent foreclosure. You may need to make concessions on the sales price to sell the home quickly. If the house sells for less than you owe, you’ll be responsible for the difference.
Let the property foreclose
This is arguably one of the least attractive options on the list. Foreclosure can affect your credit score for years, making it difficult, if not impossible, for you to purchase a home for at least 4 years. While you may be able to retain your home through a statutory redemption, laws vary by state, and you would have to pay back the foreclosure sale price plus interest. Otherwise, you’ll need to leave the property once the foreclosure process has been completed. Foreclosure can make it difficult to rent a home. If you plan to let the bank foreclose, save as much money as possible so you can afford a higher deposit on a rental.
Sell the property for cash
Sometimes letting go of a distressed home quickly is the better option overall. Selling your house for cash is often a much quicker process than putting your home on the market. Selling your home for money may be the only way to avoid foreclosure if you don’t qualify for a refinance or loan modification. You don’t have to worry about making repairs or improving the property. We work with our clients to ensure an easy transition. Selling your home for cash can eliminate seller fees and help you walk away with the most money possible. We can work with you to ensure that your transition is as stress-free as possible.
Call us with any questions today, and let us help you get started on your new journey.