Foreclosures and short sales are all the buzz these days……well for quite a while now. Almost everyone you talk to knows of a friend or family member that is facing or has gone through a foreclosure. Stop and think for a minute how many people you know that are facing financial difficulties or a possible foreclosure. A bit mind numbing.
Unfortunately, I do not believe that we have seen the bottom of the foreclosures. I wish I could look into a crystal ball and tell everyone when this will hit bottom. All we can do is speculate and make our decisions based upon the knowledge we have at the time.
If you find yourself in a position where you can no longer make your mortgage payments the worst thing you can do is to do nothing at all. Don’t just put those notices from the bank in a stack for later. You need to call your bank and tell them you are having difficulties. They may or may not be cooperative but you should still call them.
Next call a Realtor to see if they can help you. Some banks will only look at a short sale if the house has already been on the market for a few months. The banks want to see that you are diligently trying to sell the house.
After you get notices from the bank and your home is pending foreclosure you will probably start getting phone calls and letters from a lot of different people claiming they can help you out of the foreclosure. They claim they will negotiate a short sale for you. However…….their “services” require a fee. I have heard of the fee being as low as $500.00 to as high as $3,500.00. After you pay their “fees” you are ignored and your calls are not returned. You may get a token call every now and then…. well,if you are lucky. Ultimately your home goes to the court house steps for auction. Really?! This is what you paid that person to do for you? Take your money and send you to foreclosure anyway? ***** (At the time of this posting only licensed mortgage brokers or the home owners can negotiate a short sale in the State of Georgia. GAR is trying to get this law changed so that Realtors can help home owners in the long negotiation process.)*****
The other semi-scam is where you Quit Claim your property over to an investor and they take over the mortgage payments for you. They claim they will make the payments, keep you out of foreclosure and bring your credit score back up. After you sign the house over they move into the house, place renters into the house or leave it empty or……well let just your imagination run wild here as I am sure some of you have seen the trashed houses out there. This is all wonderful until the day comes when the investor stops making the mortgage payments. Then who is facing foreclosure? Not the investor, no, no,no…. you are once again on the road to the court house steps. But wait you signed a Quit Claim deed, right? You gave up your rights to the property, whatever they may have been, but you are still financially liable to the bank for the mortgage. I am not saying that this has not worked out well for some folks because it has been a life saver for them……but for others it has been a nightmare. With all that said, let me say one more thing….I know of good, honest people that have done this type of investing, stuck to their word and helped people that were in trouble facing a foreclosure. I have also seen the nightmares happen. Just be very careful if you decide to go this route. Make sure you check out the investor and their track record before you proceed.
There are good people out there that are honest and willing to help. Then there are the scammers that just want to take your money when you are most vulnerable.
If you find yourself in a foreclosure situation be very careful of the schemers. It’s a jungle out there! Read the rest of this entry »
