For the past several years, the mortgage crisis has dominated the daily news cycle. Millions have lost their homes in the past decade or so and even today, though the economy is on an upswing, people are facing foreclosure. Foreclosure can definitely affect your credit future and can stop you from being able to buy a house for years to come. However, there are some alternatives when you are facing foreclosure that can not only save your credit, they can save your home, as well.
One of the most common options that people will take when they are facing foreclosure is a short sale. With this option, you will make a deal with your lender that will allow you to sell your home for less than you owe on it. Though your lender will have to eat the difference, it is a much simpler process for everyone one and in many cases, they will agree this is the best option. The catch? You will probably have to pay taxes on that money because the government will consider it income.
Give Up the Deed
Another option you will have when facing foreclosure is to simply give the deed to your home over to your mortgage lender and walk away. Just know that you will lose everything that you have put into the home and that you will still face some taxes on the value of your home. On top of that, most lenders won’t allow you to do this until your home has been on the market for at least 90 days.
You will also find a number of government programs that are available to you if you are facing foreclosure. Some of these will help you to lower your interest rate, making payments lower. Others will allow you to refinance, even if your home isn’t worth enough. If you have lost your job, you may also qualify for a forbearance which will give you a reprieve from payments for a short time.
Typically these are your last chance options. You may be only late of a few payments, however, and can stop the process in its tracks. If that’s the case, something like a car title loan can take care of those payments and get you back on track. For more information on car title loans in Florida, contact Embassy Loans.