FAQ
I am one week from the foreclosure auction. Is there time to stop this?
Usually yes – but this is about the minimum. We like to have a couple of weeks just to get the paperwork organized and submitted. It has been done in as little as
one day, but it is very difficult to make that happen. The more time the better.
What about a deficiency judgment?
When you signed up for the loan, it is called a "recourse loan", which means you personally are on the hook for the repayment. If after the sale
the bank does not get the full payoff amount, (which they will not) they have the legal right to go after your personal assets. They have to go to court and
get a judgment which then has to be enforced and can result in docking wages, putting liens on other assets and the like. We try very hard on every transaction to
get a waiver of this deficiency, but we can not guarantee it. Generally, since you do not have any assets or enough income, the banks simply write it off and
will not go thru the legal process and expense of getting the court judgment, but they can.
I want to stay in my house. Can you help me out?
There are services that can assist in this area such as credit counseling and mortgage modification specialists. We are not experienced or experts in this
area. If there is a short sale, you will not be able to live in the house or keep it after the property is sold.
How long does the whole process take?
This is not an exact science. First we must negotiate with the bank to get them to accept a short sale amount. Then we must find a buyer for the property and
close with them. If all goes as we would like it, the entire process can be over in 2−3 months. But depending on the bank, market activity, etc. it could
take 6 to 9 months or longer.
You use the term "sign−up". What does this mean?
Basically you have to sign a set of documents that gives us the right to work with the banks and negotiate on your behalf. These documents also allow us to work with real estate agents to get the house sold.
Your signing these documents and having them notarized and returned to us is what we call the "sign−up" process.
I no longer live in the area, can I still do a short sale and avoid
a foreclosure?
Yes. Many of the initial documents you sign when you "sign−up" must be notarized. But there are notaries all over the country and most banks have
a notary public. We need original signed documents returned but once this is done, you do not have to be involved in the process if you don’t want to be.
I plan to leave the area before the foreclosure. How involved do I have to be after I sign−up?
As noted above, once you "sign−up" you don’t have to have any involvement. We are delighted if you want to stay on top of the situation and we are
glad to provide you updates as we work our way thru the process, but it is not necessary.
How long will it be before I can buy another house?
This will depend on the loan criterion that is in place in the
future when you want to buy. Right now, with most lenders, you
will have to wait 2−3 years
if you have a short sale on your credit history and 4−5 years if it
is a foreclosure. Don’t forget, your credit score is going to go dramatically
drop with either a short sale or a foreclosure. It will simply
go down less with a short sale.
I am going to get an inheritance in about 2 months so I can make up all the back payments. Should I still sign up with you?
This depends. If the bank will accept your evidence that you will be able to pay in the future, and they are willing to wait, then you should not sign up with
us. The windfall income must be enough so you are not simply postponing the inevitable but providing a permanent solution. You may be able to get temporary funding
using the inheritance as collateral. If the bank will not accept your evidence of a future windfall and temporary financing is not available then you are going to
foreclose before you get the money – in this case you will loose the house in any event so a short sale is probably a better solution than allowing the foreclosure.