Options to Avoid Foreclosure
If you are experiencing financial difficulties and are struggling to make your mortgage payment, or you’ve already missed payments and are dealing with late fees and past-due notices, you still have options available to avoid foreclosure.
With a short sale, the homeowner initiates the sale of their house and the lender agrees to accept a payoff that is less than the amount still owed on the mortgage loan. In order for the sale to be considered a short sale the homeowner must be so far behind on their payments that they cannot catch up, and the house must be worth less than the remaining balance on the loan. During the process of selling the home, the lender must review and approve the contract between the buyer and seller.
Deed in Lieu of Foreclosure
A deed in lieu of foreclosure is a transaction where the homeowner voluntarily transfers title of the home to the bank in exchange for a release from the mortgage obligation. A deed in lieu will show up on your credit report, and it may have an effect on your ability to buy another home in the future.
Forbearance is a short term agreement between the lender and borrower who is experiencing a temporary hardship. With this option, the lender agrees to temporarily reduce or suspend mortgage payments for a specified period of time with the expectation that you will bring your mortgage current. Forbearance allows the borrower to stay in the home, gives them time to get their finances back track, and is less damaging to their credit score.
If you find yourself in a situation where you cannot pay your mortgage, contact your Busey Home Mortgage lender to discuss your next steps.