The brief answer is yes! You have alternatives to avoid a foreclosure in Memphis.
The term by itself can provoke a really upsetting 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.
Fortunately, there are other possibilities if you’re struggling to keep up with your mortgage payments on schedule. And, even if your Memphis house has already entered into the foreclosure process, you can still come out of it victorious. The number one remedy is to reduce your stress as much as possible by pursuing a short sale. This means you will sell your Memphis home and the bank will take the cash you earn on the sale.
Here’s How You Can Avoid a Foreclosure in Memphis:
Step 1 on How To Avoid a Foreclosure in Memphis
First, see to it that you grasp the concept of a short sale. Your Memphis property needs to sell for enough cash to pay for the mortgage. If what you earn will not be equivalent to the loan total, you will need to generate the disparity yourself. So, see to it that your house will yield enough to cover the balance.
Step 2 on How To Avoid a Foreclosure in Memphis
Secondly, you must get approval from your bank before seeking a short sale on your Memphis home. If you aren’t yet in default, they will be much more open to deal with you. You can seek authorization more than once in the case that you are declined the first time. If the loan provider forecloses and the home enters auction, the leading bidder will own the home regardless of how low their bid was — so a short sale can be an attractive alternative for your mortgage company. Having said that, you will need to provide an authorization letter, hardship letter, statement of the home’s market value, a purchase offer/contract, and a settlement statement.
Step 3 on How To Avoid a Foreclosure in Memphis
Thirdly, once you’ve been given consent, you will have to begin searching for a realtor and an attorney who focuses in home sales in Memphis. With these pros on your side, you have a better chance of being successful and getting out of your home with no damage to your credit report. Sometimes, you’ll have the ability to pay them with the proceeds from the property’s sale.
Step 4 on How To Avoid a Foreclosure in Memphis
Fourth, you will have to determine a list price for your Memphis house that is equal to or higher than your home loan balance and any selling expenses, like the cost of your realtor. If your asking price is below what you need, you will have to start coming up with the funds for the rest of the amount.
Pros and Cons of a Short Sale on Your Memphis House
The short sale route does not provide you any profit, which is its greatest con. Nevertheless, always remember that you will in no way profit from a foreclosure, either, and you’d actually leave with a damaged credit score and potentially in a more stressful financial circumstance. That’s because having a foreclosure on your report means it will be harder to rent or buy a house — in Memphis or elsewhere. Moreover, lending institutions sometimes might require that you pay them using some of the assets you have revealed to them if the short sale does not cover the Memphis house, meaning you will need a very good attorney with you.
Most lending institutions see short sales as a favorable substitute to foreclosing, which means you will be able to step away (in a lot of situations) without a foreclosure on your financial record.
The good news is you have options to avoid foreclosure in Memphis. 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…
