Several prospective buyers and investors have contacted me about properties they have seen---and thought ---- were foreclosures because of info they found online in sites like RealtyTrac, and recently in ForeclosureRadar (California)
However, it is important to tell prospective buyers and investors that not all properties in distress are for sale. The property owners may have received a Notice of Default, or even a Notice of Trustee Sale. But not all is lost.
This may be a good time to review what a property owner can do to keep her property:
- Forbearance. the lender may allow the property owner to pay less than the full amount of the mortgage payment during the forbearance period. Mortgage companies may consider forbearance when the owner can show that funds from a bonus, tax refund, or some other source to bring the mortgage current at a specific time in the future.
- Reinstatement. The owner pays mortgage company the total amount she is behind, in a lump sum, by a specific date.
- Repayment plan. The owner is allowed a fixed amount of time to repay the amount she is behind by combining a portion of what is past due with the regular monthly payment. At the end of the repayment period owner would have gradually paid back the amount of the mortgage that was delinquent.
- Loan Modification --- now one of the most popular ways to save the property. The owner and her mortgage company may agee to alter one or more of the original terms of the note to make the payments more affordable.
- Short Sale. And if nothing works, the seller may want to sell the property as a SHORT SALE (i.e., sell for less than what she owes). The owner is no longer the final decision maker because the lender will have to approve the sales price in order to “forgive the difference between what it actually sells for, and how much is left of the loan).
Compassion. Assistance. Understanding.
Now, more than ever, we should convey to our clients and associates that Realtors are not just in business to list and sell homes....rather, we are also here to help homeowners KEEP their homes. Let's show them the way.
Recently, I saw where one my clients was struggling and had in fact tried to work with her lender to get her loan modified. At that stage, because she was already served a Notice of Default, she can't do this alone without professional assistance. So I put her in touch with a loan modification specialist.
When her loan modification was approved, it seems the burden of the world was lifted from her shoulders. Tears flowed. And flowed. And flowed. We were both overcome with emotion. What a fantastic feeling to know that we were able to help.
Let us be the beacon of light to guide them.
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