With thousands and thousands of homeowners across the country facing foreclosure each year, it can be an emotional and even physically draining experience. Now with that said, you may be able to “avoid foreclosure in Dallas,” by tackling the situation head-on and taking proactive steps to turn things around. We at We Buy Houses Cash Dallas, has kept up with the situation and has continued to buy house in foreclosure.
When a borrowers falls behind on mortgage payments, is when foreclosure occurs. Then the lender that helped make the loan, will seize the property and possibly sell it and try to recover at least some of the money that the homeowner borrowed. In most cases, a lender won’t start the foreclosure process until the mortgage is 120 days late or past due.
After covid-19 caused a recession, the Department of Housing and Urban Development established a moratorium on foreclosures for single-family homes purchased with a federally backed mortgage. Today, all that has past us, but the experience has left the U.S. economy strained.
Though foreclosures fell due to the moratorium and are coming back around for more homeowners, today we see more and more people need to avoid foreclsure in Dallas, as in past years. Again, at We Buy Houses Cash Dallas, we want to help homeowners in foreclosure either by working with their lender, or buying the house.
You Can Avoid Foreclosure
When a homeowner starts missing payments, a notice of default represents the first step in the foreclosure process. Most lenders send this notice to the borrower as a formal warning that the home will be seized if overdue mortgage payments aren’t brought up to speed by a certain date. This window of time is known as pre-foreclosure.
So, if your home has gone into pre-foreclosure (or you fear it soon will), what are your options for keeping your home? Here are a few of them.
- Contact Your Lender or Loan Servicer and work with them on a remedy. When you contact your lender, you may be able to avoid foreclosure in Dallas. At We Buy Houses Cash Dallas, we can work with you and yuor lender, should you not want to deal with the lender at all. You may be able to reach an agreement on a payment plan, a temporary forbearance or a modification of the loan terms. With a payment plan, you may be able to work out a way to catch up on past-due payments. A forbearance lets you temporarily make lower mortgage payments or pause mortgage payments. An example of modification is reducing the monthly mortgage payments. If at all possible, reach out to your lender before you start missing payments.
- Sell your house fast in Dallas. Before your home is seized, you may be able to sell it to satisfy the mortgage debt. If the home winds up selling for less than what you owe, this is known as a “short sale.”
- Filing bankruptcy may not be a good thing. Understand this bankruptcy thing, when you file Chapter 7 bankruptcy it merely delays a foreclosure. On the other hand, Chapter 13 bankruptcy may let you catch up on past-due payments and keep your home. Chapter 7 bankruptcy wipes out most of or even all of your debts, while Chapter 13 bankruptcy creates a plan for repayment of some or all of your debts. Before you forge ahead with this option, though, consider the severe consequences bankruptcy has on finances and credit worthiness, as it may be hard to recover from.
- Maybe – Agree to a deed in lieu of foreclosure. A deed in lieu of foreclosure allows a homeowner to hand over their house to a lender in exchange for the homeowner to avoid foreclosure in Dallas. Before you give up your home to your lender, We Buy Houses Cash Dallas, would want to buy your home. This way you do receive money for your home, not simply giving it backto the lender for zero dollars.
All homeowners know and realize that staying current on your mortgage payments is the most obvious way to avoid foreclosure in Dallas, but this can be difficult, especially when you’re already behind on payments. If you’re experiencing financial hardship you may be able to find financial assistance that helps you take care of bills at local churches and Salvation Army and other needs so you can more easily afford your mortgage payment (more on that later). People get complacent, get a part-time job, cutting expenses and getting a handle on your debt are additional moves you can make to help you keep your head above water and prevent your home from being foreclosed.
You Can Get Foreclosure Help
Handling a potential foreclosure on your own is hard to do. You don’t need to shoulder the burden by yourself, though. Several options are available.
Consult Multiple Attorney’s
Consider your circumstances, you may want to consult with a couple of foreclosure attorney’s. You may even be able to find an attorney who will offer services for free, or get assistance from an organization that offers free legal aid. either way, you need to consentrate and spend your time trying to avoid foreclosure in Dallas, on your home.
A foreclosure attorney can help you understand your legal rights throughout the process and, in some cases, may be able to find a legal defense that allows you to avoid foreclosure altogether. Foreclosure can be a complicated legal process for both the lender and the homeowner, and having a lawyer on your side can help. An attorney may come with a high price tag, but the cost may be worth it, especially if you believe you’re being foreclosed on illegally.
Does a Foreclosure Affect Your Credit?
Aside from bankruptcy, foreclosure is one of the worst things that can happen to your credit. That impact doesn’t last forever, though. These are some of the ways a foreclosure plays a role in your credit:
- The appearance of a foreclosure on your credit report can bring down your credit score. How much your score drops depends on several factors, such as what you score was before foreclosure and how many other negative marks show up on your credit report. The missed payments leading up to foreclosure also will have a negative effect on your credit.
- For several years after a foreclosure, your ability to qualify for a credit card, loan or other lending product may be restricted.
- Missed mortgage payments and foreclosure will be reflected on your credit report for seven years. After the seven-year period ends, the foreclosure will be removed from your credit report and will no longer affect your scores.
- Even if your credit score has recovered in the time since your foreclosure, its presence on your credit report could disqualify you from getting a mortgage loan in the future. Some lenders won’t consider approving a borrower if there’s a recent foreclosure in their credit history. If you are approved, expect to pay higher interest rates or extra fees.
The Bottom Line
If you’re on the brink of a home foreclosure or have already been through one, be sure to keep on top of your expenses so that you can stay in your current home and stay financially comfortable. Even more important, don’t ignore a foreclosure or pre-foreclosure (such as failing to read mail or answer phone calls from a lender or loan servicer). Doing so could make it harder to hang on to the house you worked so hard to buy and maintain. Avoid foreclosure in Dallas, it can be one of the hardest things you do for your family. Then again, you shouls not have put yourself or your family through this bitter taste.
Throughout the process, and even long after, it’s important to keep a close eye on your credit. Experian credit monitoring can alert you to score changes and things like new inquiries or suspicious activity detected in your Experian report.
