What to do if you are facing foreclosure?

What to do if you are facing foreclosure?

It has been a while since I have talked about this subject because there really has not been all that many foreclosures available in the Minneapolis Saint Paul market. I am not going out on a limb and predicting that something is going to change suddenly. Ever since I started blogging and making videos, I had been getting requests from people asking me to cover different subjects in real estate. This one is something that is on many people’s minds right now. It must be a combination of the current political state, inflation, and impending recession as some experts predict along with job layoffs.

Whatever the situation might be if you find yourself falling behind on your mortgage and you are wondering what to do, the video attached to the bottom of this blog will answer those questions. I think the most important thing to consider is staying in control of your situation by deciding ahead of time and having a plan. Many people fall into a situation where they cannot decide, so it is made for them by the bank. Do not be one of those people, stay in control of your destiny no matter how hard it may be to face.

The basic process of a foreclosure is once you fall behind the bank will send you notices. Sometimes it happens after 30 days and sometimes it happens after 90 days. Every single bank is different in how they manage things. Once they have notified you several times, if you have not gotten caught up with what you owe, they will put a foreclosure notice in the newspaper. It is called foreclosure by advertisement. Once that is completed, they set-up a sheriff’s sale. At which time they hold control of the property, and the six-month redemption period starts.

During the six-month period you have the right as the homeowner 2 pay all you owe in payments, interest, and other charges that the bank has now piled on. You can then keep your house and it is back to business as usual making a monthly payment. Your credit will still take a hit but nothing like they hit it will take if you are foreclosed on.

Once the six-month redemption. Is up, at that point it is over, and you will receive a notice of eviction. Again, every single bank is different. Banks will send out a notice with the sheriff within 30 days and others take months before they contact you.

There are two other options that you have before all of this starts. If you feel that you have equity in the home, the best course of action may be for you to sell the house, pay what you owe and walk away with some money in your pocket and hopefully only a small credit ding. contacting a real estate agent like myself is the first step because I can walk you through all your choices and steps of how this plays out.

Your other option would be to try to do a short sale. But the only way for that to work is if you owe more money on the home than it is currently worth in the market. This one is trickier for several reasons. This is a Hail Mary pass and should be avoided at all costs.

I am not going to sugarcoat it and say that the foreclosure process is easy or the right thing to do. But there are some people who truly have issues like the loss of a job, divorce or medical problems that lead them down this road. It is nothing to be ashamed of. However, if you can avoid it, overall, you will be much better off.