What is Pre Foreclosure?
It’s a sad truth but tons of Americans and people worldwide are losing their property as a result of foreclosure annually. Some lenders are not diligent enough to check the ability of the person to make repayments whiles others just don’t care. Well of course, there are some situations wherein there is unexpected events that we face making us incapable to pay for mortgage.
No matter what the cause for client to lag on payments, the process from that point is set. Initially, the lender is going to file for public default notice. This will then initiate the foreclosure process and it’s also at this point that the property would enter the pre-foreclosure stage. Simply put, pre-foreclosure is the homeowner’s grace period to settle whatever issue they have in their home.
The homeowner is warned that they are in default and have to take actions to solve it. If for this, the lender would not have the authority to claim the property and sell it to recover the costs. The duration of grace period will vary depending by the state laws. There are some state laws that have grace period which last for 6 months but some states have shorter periods than this. When the property entered pre-foreclosure, there are actually numerous ways that homeowners could do in avoiding foreclosed property and be sold by their lender. And two of the most common options are discussed in the next paragraphs. If you want to learn more about it, I suggest you to keep on reading.
Number 1. Pay off the default – however, the property will be removed from pre-foreclosure in the event that the homeowner wasn’t able to settle the default amount. In the event that the default amount is small and that the default was caused by temporary glitch, then it might be worthwhile to take out personal loan to repay the debt. If the problem is ongoing, this may just open up more issues for the homeowner.
Number 2. Sell the house – this is a bit more drastic move but probably, it’s the best solution that you can do if you can’t meet the repayments. You as a homeowner will be able to get reasonable prices by selling it. It is never a smart move that you wait for the lender to sell the house because they are going to sell it in a lower price in an effort to get rid of it. This is because the lender will offload the property as quick as they can.
For sure, you can counter the foreclosure of your house but wouldn’t it give you peace of mind if you don’t have to worry about such?