Pre-foreclosure is a legal process that occurs when a homeowner in Montgomery County falls behind on their mortgage payments and the lender initiates the process of foreclosure. During pre-foreclosure, the homeowner is still the legal owner of the property, but the lender has the legal right to begin foreclosure proceedings if the outstanding debt is not resolved.
Pre-foreclosure can be a stressful and uncertain time for homeowners, as they may be facing the prospect of losing their home and damaging their credit score. However, it is important to remember that pre-foreclosure is not the same as foreclosure, and there are steps that homeowners can take to avoid losing their property.
In this article, we will explore what pre-foreclosure is and what it means for homeowners in Montgomery County. We will discuss the various options that homeowners have during pre-foreclosure, such as negotiating with their lender, selling the property, or seeking government assistance. By understanding the pre-foreclosure process and their options, homeowners can make informed decisions and take the necessary steps to protect their home and financial well-being.
So what is a pre-foreclosure in Montgomery County anyway?
Numerous homeowners in America, including those in Montgomery County, are encountering challenges in keeping up with their monthly mortgage payments. Once a homeowner has missed 3-6 months of mortgage payments, the lending institution will issue a warning indicating that the homeowner must either pay the outstanding balance or risk losing their home. This period is referred to as “pre-foreclosure.”
Usually, banks and mortgage lenders offer homeowners three months to bring their payments up to date, but this timeframe can vary depending on the bank and individual circumstances. If the homeowner fails to make the necessary payments, the bank will initiate foreclosure proceedings, take possession of the property, and evict the homeowner. However, during the pre-foreclosure stage of the foreclosure process, mortgage holders have a range of options available to them to prevent losing their home.
Pre-foreclosure Options for Borrowers
If you’re behind on mortgage payments, you’re likely to receive a “notice of default” from your mortgage lender.
This document will state that you have not made mortgage payments for the last 90-180 days. It’s important not to panic.
You have options that can delay or even prevent losing your home:
- If your mortgage is “above water,” (meaning you have equity in your house) you may be able to refinance your mortgage, receiving lower monthly payments. Check with your local Montgomery County mortgage broker… or contact us and we can connect you with a reputable one.
- You may be able to quickly sell your home to a real estate investor that’s reputable in Montgomery County like us at Property Buyer Today, using the cash acquired to pay the months of back-payments owed (or we *may* be able to work out something with the lender that relieves all or part of your back payments.We can buy your Montgomery County area home quickly, often in just a week or two, will pay in cash, and takes the stress out of trying to find a buyer.
- You can contact the bank and ask them to permit a short sale. In a short sale, you’ll sell your home for less than it’s worth, and the bank will take the loss as a tax write-off. In some short sales you may still be required to pay the difference to the bank if the house doesn’t sell for what is owed on the loan.
- You may be able to declare bankruptcy, which can buy you time to pay your debt. Bankruptcy will remain on your credit report for years, and can cause significant damage.
Lenders are very much aware of the widespread financial troubles across the country and they’re willing to work with borrowers a lot of the time.
If you’re honest and communicate with your lender, you’ll often find that there are options that will allow you to remain in your home, or at least salvage your credit rating.
A foreclosure can often negatively affect your credit score by 200-400 points and can prevent you from obtaining a loan of any sort for 5-7 years, so be very dutiful if you’ve received a Notice of Default from your lender.
But if you’re not able to find a solution with your lender working directly with them… connect with us. We may be able to help.
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 Montgomery County area house – We buy houses in Montgomery County and would love to make you an all-cash offer on your house too. Just fill out the form here to get started >>
- You can ask us questions and we can provide you FREE guidance and resources so you can make a well educated decision. This costs you nothing, there’s absolutely no pressure, no obligation… just free guidance without a catch.
If you’re in the pre-foreclosure stage… you’ve still got time to fix this situation.
Just connect with your bank to see if they’re willing to work with you… or contact us if you’d like to see what we can buy your house for or to tap into our free foreclosure foreclosure resources.