The short answer is yes! You have options to avoid a foreclosure in Chattanooga.
The term in itself can conjure a very stressful and terrifying sensation when you begin thinking about what all it can mean — a long struggle, ending up broke and/or unemployable, and, in worst cases, even homeless.
The good news is, there are other possibilities if you’re struggling to make your mortgage payments in a timely manner. And, even if your Chattanooga house has already entered into the foreclosure process, you can still come out of it victorious. The initial remedy is to minimize your stress as much as possible by seeking a short sale. This means you will sell your Chattanooga home and the financial institution will take the money you get on the sale.
Here’s How To Avoid a Foreclosure in Chattanooga:
Step 1 on How To Avoid a Foreclosure in Chattanooga
First, make sure that you understand the idea of a short sale. Your Chattanooga property needs to fetch enough cash to take care of the mortgage. If what you earn isn’t actually equal to the loan amount, you will have to come up with the discrepancy yourself. So, make certain that your home will sell for enough to cover the balance.
Step 2 on How To Avoid a Foreclosure in Chattanooga
Secondly, you will need to get approval from your loan company before trying a short sale on your Chattanooga house. If you aren’t yet in default, they will be more open to work with you. You can seek permission more than one time in the case that you are turned down the first time. If the loan provider forecloses and the house goes into auction, the top bidder will acquire the house irrespective of how low their bid was — suggesting a short sale can be an appealing option for your loan provider. That being said, you will have to present an authorization letter, hardship letter, statement of the home’s value, a purchase offer/contract, and a settlement statement.
Step 3 on How To Avoid a Foreclosure in Chattanooga
Thirdly, once you have been granted consent, you will need to begin hunting for a realtor and a lawyer who specializes in home sales in Chattanooga. With these professionals on your side, you have a significantly greater probability of succeeding and getting out of your house with no damage to your record. Sometimes, you’ll have the ability to pay them with the earnings from the house’s sell.
Step 4 on How To Avoid a Foreclosure in Chattanooga
Finally, you will have to set a list price for your Chattanooga home that is equal to or higher than your mortgage balance and any selling costs, like the cost of your realtor. If your asking price is lower than what you need, you will have to begin coming up with the funds for the rest of the amount.
Pros and Cons of a Short Sale on Your Chattanooga Home
The short sale method does not allow you any profit, which is its greatest con. Even so, keep in mind that you will in no way profit from a foreclosure, either, and you would actually walk away with a lower credit score and possibly in a much worse financial scenario. That’s because having a foreclosure on your report means it will be harder to rent or purchase another home — in Chattanooga or elsewhere. Additionally, loan providers sometimes might be adamant that you pay them using some of the assets you have divulged to them if the short sale does not cover the Chattanooga house, meaning you will need a very good attorney with you.
Many mortgage lenders see short sales as a favorable substitute to foreclosing, so that means you will be able to step away (in the majority of scenarios) without a foreclosure on your financial record.
The good news is you have options to avoid foreclosure in Chattanooga. If you want to talk about your situation to see if we can help — we can buy houses before or during the foreclosure process. Give us a call at 423-375-8575 or fill out our form below…
