What Do You Really Know...When You are in Foreclosure, Part 2
by John Occhi REALTOR
Realtor Consultant to Foreclosure Investors
I just posted an article that I wrote to diminish some of the myths that homeowners hear all the time - often form those with good intentions but often form those who are misinformed, telling half-truths or repeating out dated information. Some times the information comes from those we would normally feel comfortable with in seeking advise - you know family members, neighbors and co-workers and then sometimes the lies are spread by devious individuals looking to capitalize on your unfortunate situation.
As a disclaimer, I am a professional REALTOR who has a fiduciary responsibility to every client I represent. A very simple definition of a ‘fiduciary' is putting the clients interests ahead of my own personal interests. If we ever talk person-to-person my first objective is to help you explore your alternative when it comes time to saving your home. If that fails, then I hope you will list it weight me so we can sell it and get you out from under the burden of your mortgage, even if it is a "Short Sale". That is my only objective
In this segment, we will explore some of the other common fallacies that I hear homeowners repeat to me on a regular basis.
MYTH: If the Bank takes my home back, I can then just walk away and start over
TRUTH: This may be true but it will hardly be a walk-a-way clean. First, you will have an IRS tax liability for the amount of the loan that is written off. You may even have a capital gains tax. Your credit will be damaged and there is still the possibility a lender could pursue you for the deficiency through judicial proceedings. This is especially true if your loan is a re-finance and you took cash out. I would strongly suggest you investigate your situation with a loss mitigation professional.
MYTH: The Bank is refusing to take my payments - There are no other alternatives!
TRUTH: Once again, the Bank wants your money - money is the only product the bank really has...yes they package it in a variety of different ways - but money and your interest is the lifeline of any lender. If you are not having success negotiating with the bank, then perhaps a professional Loss Mitigation professional may be able to help with a number of different alternatives - depending on your personal situation.
MYTH: I raised the cash to bring my loan current - but I don't think the bank wants it now.
TRUTH: In California, as most other states, .you can redeem your loan right up until the time it is sold. Remember, the bank DOES NOT WANT YOUR HOME
MYTH: The bank is going to keep all of my personal belongings once they take the house back.
TRUTH: The bank is no more interested in your personal belongings then they are in taking back your house. If it is yours, take it with you. However, please remember that if it is attached to the house it became "real property" and stays with the house. Yes, I know you paid $10 a piece for the fancy light switch covers - but they stay with the house - the same as the dishwasher, lighting fixtures, and even the toilet does not belong to you - it is part of the house. If you strip the house before you leave, you are undoubtedly asking for trouble.
MYTH: I don't have to pay legal fees on top of everything else if I redeem my loan - after all, the bank is the one who started the whole process.
TRUTH: They started the process because you were not living up to your end of the deal - making your payments. They will have legitimate legal expenses that, yes, you will have to pay if you are going to redeem your loan. Typically, fees start around $1500 and escalate the longer the process has evolved and how much work the lenders legal team has put into the process.
MYTH: I can't talk to anyone about my pending foreclosure - there is no one who can help ME in MY situation
TRUTH: There is always help if you act quickly enough. You can search the internet for any number of resources - perhaps this is how you found this article. As a REALTOR, I have recognized the problem in the market and aligned myself with a reputable national company that works for the homeowner exhausting alternatives to keep the homeowner in the home - if that is truly in the best interest of the homeowner. If that doesn't work - then listing with a reputable and experienced REALTOR may be your best solution. There is always help...sometimes you just need to get on your pknees and pray to your Creator.
I hope this answers some of the questions that homeowners ask themselves on a daily basis when they find themselves in trouble with their real estate mortgage. They need to be able to stop the foreclosure process when they call out, "Save my Home!". They can, if they just keep a level head and work diligently towards the goal. The end outcome may not be the ultimate plan they have in mind, but at least they should be able to sell their real estate and move in dignity.
If you are a homeowner facing foreclosure and want a sympathetic ear to hear your situation, please call me - perhaps as a REALTOR, I can offer a different perspective than what you have heard from so many others.
If you are a bona-fine legitimate investor looking to invest, please contact me and lets see if I can't find you the right opportunity.