Short Sales | Resources
Do you owe more on your home than it is currently worth? Has your income been reduced or have you suffered a job termination where keeping up with your mortgage payments is difficult or impossible? You may need to consider options such as a short sale, described in the reports below, just click on the link to read or print out the information (links to these reports are to material located on my site, not to offsite locations).
Your options could include keeping your home through loan modification, or a refinance through specific programs offered with your bank's cooperation. Many owners would like to do a loan modification, or may currently be attempting one, with their bank. You should gain more information about whether or not this might work for you, and find out more about the criteria used by servicers to judge borrower eligibility. Should those programs not be possible, you may finally consider a short sale, which is an application to your bank for it to accept a lower loan repayment than what you currently owe, because of the lowered market value of your home combined with your hardship. You could even be in the position of not having to do a short sale because you really do have positive equity, but your loss of income is affecting your ability to pay for your mortgage. A short sale requires a showing of hardship, and there are numerous events that can lead to a legitimate showing of hardship. Also, for a bank to successfully approve your short sale, it must be listed with a REALTOR as part of the package.
Don't ignore notices you receive from your bank, because foreclosure for most people should be avoided because it has the most and longest-lasting impact on your credit and future homebuying ability when compared to a short sale. It's important to know that, while some servicing companies and banks may not always adhere to the guideline depending on their own investors and decisions, California does have a minimum foreclosure timeline from the time a Notice of Default is recorded to reach date for Notice of Sale, which is approximately 120 days which may be the maximum amount of time a homeowner has to get the property sold.
Below are links to review for programs that may apply to you; it is strongly advisable to also speak with a local REALTOR professional to first review important aspects, and also to consult with a tax or legal consultant for their professional information.
Please contact me directly or by using the form below for a confidential appointment.
Watch Out for Scams
There are legitimate procedures for handling short sales and loan modifications. But please watch out for some basic things which are not legitimate:
1. An individual or company wants to be paid up front to help you with your loan modification, short sale or foreclosure.
2. They offer to fill out the paperwork for you.
3. They want you to pay them directly instead of sending payment to your bank.
4. They ask you to give them your power of attorney.
5. They want you to give them title to your property.
6. They ask you to lease your house from them and buy it back over time (also be aware that there is a legitimate HUD housing program with approved entities that can do this, which can be verified.)
There are other factors too, but if you have any doubts you should contact the Consumer Financial Protection Bureau at (855) 411-CFPB or file a complaint online with them.
Find Counseling Resources and Links for Loan Modification, Short Sale or Foreclosure Help
There are numerous sources listed here, but please, if nothing else, take a look at the HUD site's resources.
Nonprofit organizations and other experts dedicated to helping property owners in distress to avoid foreclosure:
• Consider contacting your attorney or a local Legal Aid office, especially if you think you were the victim of questionable lending practices. A good place to start is at www.lawhelp.org.
• Homeownership Preservation Foundation offers a nationwide assistance number—888.995.HOPE. You can speak with a counselor, day or night, to help you get back on track financially. (English and Spanish)
• Reputable counseling agencies, can help you avoid foreclosure.
For immediate advice, call 888.995.HOPE to speak to a counselor on how to avoid foreclosure. Available in English and Spanish, 24/7. Or visit www.995hope.org for more information.
IMPORTANT: Avoid paying anyone, including an attorney, fees up front for a loan modification. Fees may not be collected for this service until the loan closes.
Fannie Mae: http://knowyouroptions.com - Resources for leaving your home or staying in your home, including re-finance, deed-in-lieu, forbearance, loan modification, repayment plan, deed-for-lease, short sale, foreclosure.
• List of HUD-approved counseling agencies: www.hud.gov/counseling. The list may be used as a starting point to find good counselors. Watch out for questionable counseling companies who advertise that, for a minimal fee, they will hire a lawyer to defend the foreclosure in court or negotiate lender assistance on your behalf. You should call a HUD-approved counseling organization, or 888.995.HOPE before you pay or sign anything.
• “How to Avoid Foreclosure” (aimed at FHA borrowers but can help others as well). www.hud.gov/foreclosure.
Freddie Mac: “Keeping Your Home, Protecting Your Investment.” Go to www.freddiemac.com and search for this brochure by typing in the full name of the brochure.
Ginnie Mae: For a simple calculator to help home buyers estimate how much they can afford to spend, read “How Much Home Can You Afford?” http://www.GinnieMae.gov.
Consumer Information issued by the Federal Reserve Board (FRB) and the Office of Thrift Supervision (OTS). Consumer Brochures
• Equifax 800.685.1111 www.Equifax.com
• Experian 888.397.3742 www.Experian.com
• TransUnion 800.916.8800 www.TransUnion.com
Go to www.AnnualCreditReport.com to ask for a free copy of your credit report, once a year, or call 877.322.8228. See also www.FTC.gov or www.myfico.com.
California Short Sale Information
Loan Modifications, Foreclosure, Bankruptcy
This is a growing issue for many borrowers. One of the key reasons for not qualifying for a loan modification is income.
You should document your conversations with your bank and the activity you've undertaken to complete a loan modification. If you have attempted a loan modification with a listed national bank, but are not getting results, you may go to the Comptroller of the Currency at http://www.helpwithmybank.gov/complaints/index.html for further assistance or action.
Know your options about a deed-in-lieu (giving back to the bank) and doing a short sale.
Bankruptcy is a serious legal step with longterm implications. A borrower should thoroughly investigate this course before taking action, and seeking legal and tax advice as well. It may or may not do what is best for the borrower, and may still have tax ramifications.