©Vichaya Kiatying-Angsulee - freedigitalphotos

©Vichaya Kiatying-Angsulee – freedigitalphotos

If you are facing foreclosure, then you are likely looking into options to get out of it.  One you may have seriously considered is doing a pre-foreclosure sale on your home.  If you are still in the early foreclosure stages then this is something to seriously consider.  A pre-foreclosure is when you sell your home before you are officially foreclosed on.  Most of the time it is right before the foreclosure auction is set to take place.  Usually you will be selling your house for less, wanting to get it off the market quickly before you get officially foreclosed on.

Why consider a pre-foreclosure sale

Not all homeowners are able to receive assistance from their lender to avoid foreclosure.  If you are one of these people a pre-foreclosure sale, may be you last option.  If you want to keep a good credit standing in the future, selling your home before you are foreclosed on is in your best interest.

A foreclosure can negatively impact your credit for years to come.  You may hear that one way to avoid foreclosure is to file for bankruptcy, which is true.  But if your main concern is staying with good credit, this is not a very viable option.  It will be seven years after receiving a bankruptcy discharge, that you will be able to have a clean credit rating.  Selling your home, will keep your credit hopefully good enough, to possibly find another place that has a more affordable mortgage payment.

If you do decided to sell your home, be sure to tell your lender.  Banks do not want to foreclose on people, so if you show that you are trying to avoid it as well, they may give you extra time to sell the place.  Be open and honest with your lender, maybe you didn’t come up with any alternative foreclosure options together, but that doesn’t mean they won’t help you if they can.

It is up to you if you want to try and sell the home on your own or go with a realtor.  A realtor is advised for a quick sale though; they know all the tricks to the trade and already have potential buyers in their network.  Their job is to sell houses, so must of them know what to say and when to say it, when “wooing” a potential buyer.

Also having a third party that doesn’t have emotional ties to the house can be good too.  It may come across to the buyer how sad you are to sell the house and they may hesitate to purchase it from you.  Also you may possibly have people that look down on you, because they know you are in pre-foreclosure.  Unfortunately there are many misconceptions that surround those facing foreclosure.  You will run into people that will possibly treat you rudely, having a Realtor to deal with these type of people will take all the stress away.

Of course the worst part of a pre-foreclosure sale is the loss of a home, you may have wanted to save.  This may be hard at first, but consider it a new start, where you can have clean slate and get into a place with more affordable payments.  All the stresses that come with facing foreclosure will be gone.

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  1. […] If the loan balance is not brought current within a specfied amount of time the loan will be in a pre-foreclosure status, whereby borrower is required to pay existing past due amounts or structure loan […]