Behind in payments on your Downey Home?

Mortgage and Lending with Century 21 All-Stars

Behind in payments on your Downey Home?

Is your home in distress? Are your payments late? There are a variety of reasons why you have fallen behind in payments on your home. Your rate is adjusted, you lost your job, perhaps a family illness. If you are facing this situation on your home and can't simply pay the amount past due on your mortgage, you have 3 main options to save your Downey real estate from foreclosure.

1. Do Nothing and Foreclose on your Downey Home

Unfortunately this is still an option for you and many families are doing just that. While waiting for the sheriff to come and get may have a "me-against-the-world" glory feeling to it this is the absolute worst thing you can choose.

For starters, you will not be able to purchase another home in Downey or anywhere else for at least 7 years. If you have any dreams of owning another home, especially another beautiful home in Downey, you will have to wait at least 7 years after you foreclose. That's almost a decade before you buy another home!

Additionally if your Downey Real Estate goes all the way to foreclosure it will stay in your record for 10 years. This will affect your ability to borrow money, auto loans, credit cards not to even mention buy another home in Downey.

Option 2: Forebearance or Loan Modification on your Downey Home

A forbearance or a modification of your Downey home loan are similar in that the way you pay will (or should) be different from what you have been paying. Let's find out the differences.

First of all a forbearance of your Downey home loan really is just a repayment plan. If you fell behind in payments with a forbearance plan the bank will allow you to play "catch up" and be current with your payments. This may be an acceptable option if you have fallen behind only a few months and have the money to pay extra each and every month until you catch up. However if you are behind by more than a few months or even a year or more most families may not be able to save their Downey home from foreclosure through a forbearance plan.

In a loan modification the bank may adjust the terms and/or the interest rate of your loan on your Downey real estate. While there are many types of loan modifications available, both temporary and permanent, you must ask yourself...

Is it worth staying in my Downey Home through a forbearance or loan modification?

You must decide this because while your payments (especially after a loan modification) may be affordable, is it really worth it if you are $50,000, $100,000, or more under water on your home? Does it really make financial sense to keep making payments on a home that's hundreds of thousands under water when you can short sell your home and in 2 years buy a similar home for hundreds of thousands less?

Option 3: Short Selling your Downey Home

It may be tough for you to decide that you must short sell your Downey home. Sometimes you may not have a choice. However you may have received a loan modification...but is it worth staying if you owe hundreds of thousands of dollars more than your home is worth?

What separates successful investors from the non-successful investors is that the successful investor must be detached from the outcome. They know when to cut their losses and move on to another opportunity. The non-successful ones will feel they have to "stick in for the long run" and it will eventually even out. Well, just look at all those people that have lost their retirements during these economic times...

You know it's tough to look at your Downey home as an investor. However, if you step back and see that you DO OWE $50,000, $100,000 or more than the home's value... Is it worth it??? Paying for the next 20-30 years thousands upon thousands of dollars on interest an equity you will never see... again ask yourself... Is it worth it?

If you answer "Of course not Paul!" You should sell off that bad investment and move on to the next one. As hard as it may be to tell your family you need to sell your Downey property, remember this: You house is not your Home. You and your family can create new memories and in 2 years you should be able to purchase a new house in Downey - at market price thousands and maybe hundreds of thousands less than what you currently owe today.

Find out what your Downey Property is worth.

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