As a significant number of residential properties in the United States are being subjected to foreclosure, it is crucial for mortgage holders and potential buyers alike to have a clear comprehension of the proceedings involved. It is imperative to comprehend the process in order to make informed decisions and avoid any potential pitfalls that may arise.
So what is a pre-foreclosure in Kansas City anyway?
Numerous property owners in America, including those in Kansas City, are currently facing challenges in fulfilling their monthly mortgage obligations. In case a homeowner misses between 3-6 months of payments, the lending institution will issue a warning, informing the homeowner that failure to pay may result in the loss of their property. This phase is commonly referred to as “pre-foreclosure.”
Mortgage providers usually allow a grace period of three months for the homeowner to become current. Nonetheless, this timeframe may vary based on the lender’s policies and the homeowner’s circumstances.
If the homeowner fails to pay the outstanding amounts, the bank will initiate the foreclosure process, taking ownership of the property and evicting the homeowner. Fortunately, during this phase, mortgage holders can explore various options to prevent the loss of their property.
Pre-foreclosure Options for Borrowers
In the event that you have fallen behind on your mortgage payments, your mortgage lender is likely to send you a “notice of default.” This notification will outline the number of days, usually between 90-180, for which you have failed to meet your mortgage obligations. It is crucial not to succumb to panic upon receiving this document.
You have options that can delay or even prevent losing your home:
- Assuming that your mortgage has a positive equity value, meaning that your home’s value is higher than your mortgage balance, you may have the opportunity to refinance your mortgage, potentially leading to lower monthly payments. It is advisable to consult a reliable mortgage broker in Kansas City for more information. Alternatively, you can contact us, and we will connect you with a reputable mortgage broker.
- In the event that you are unable to pay the arrears owed, you may consider selling your home to a reputable real estate investor, such as 1st Key Homebuyers, operating in Kansas City. The proceeds from the sale could be used to settle the outstanding payments. In certain situations, we may also be able to negotiate with the lender to eliminate some or all of the arrears. Our company can purchase your home in the Kansas City, Mo region promptly, frequently within one or two weeks, paying in cash and alleviating the burden of searching for a buyer.
- One option is to contact your bank and request permission for a short sale. This involves selling your home for an amount lower than its current market value, with the bank bearing the resulting loss as a tax write-off. It is important to note that in some short sale agreements, you may still be responsible for paying the difference to the bank if the home does not sell for the outstanding loan amount.
- Filing for bankruptcy may be a viable option for obtaining additional time to settle your debts. However, it is important to bear in mind that declaring bankruptcy can have long-term repercussions, such as remaining on your credit report for several years and causing considerable harm to your credit score.
In light of the economic difficulties facing many individuals and families nationwide, lenders are frequently willing to collaborate with borrowers to explore potential solutions. If you are transparent and maintain open communication with your lender, you may discover that there are viable alternatives that can enable you to retain ownership of your property, or at the very least, salvage your credit rating.
Defaulting on your mortgage payments and experiencing foreclosure can have a significant negative impact on your credit score, with potential repercussions of 200-400 points, and the potential to render you ineligible for any kind of loan for 5-7 years. Therefore, it is important to take this matter seriously if you receive a Notice of Default from your lender.
If you find that direct collaboration with your lender is unsuccessful, don’t hesitate to contact us. We may have resources available that can assist you.
Ways We Can Help If You’re In Pre-Foreclosure
- We can potentially help with a short sale – Submit your info on this website so we can evaluate your situation to see if we can help.
- We can buy your Kansas City area house – We buy houses in Kansas City and we are able to make you an all-cash offer on your house too. Just fill out the form here to get started >>
- Our team is available to address any questions or concerns you may have, and we are pleased to offer our guidance and resources at no cost to you. We understand that navigating a difficult financial situation can be overwhelming, and we are committed to assisting you in making an informed decision that is best for your circumstances.
- We want to assure you that there is no pressure or obligation involved when seeking our assistance. Our aim is to provide you with the information and resources necessary to make the best possible choice, without any hidden agendas or ulterior motives. Our guidance is entirely free and without a catch.
If you’re facing the pre-foreclosure stage, don’t despair. There are still options available to you to resolve the situation. One of the first things you can do is reach out to your bank and explore potential solutions they may be able to offer. Alternatively, you can contact us to see how much we can offer to buy your house for, or to access our free resources on how to deal with foreclosure. We’re here to help you find the best solution for your situation, so don’t hesitate to reach out.