For those facing foreclosure, you have several options:
Option 1: Pay the piper. If you have not already received a
statement from the attorney for your mortgage lender, here is a rough
calculation:
Your current approximate arrearage is : $ 1,500.00.
The $1,500 for the mortgage company's attorney fees and costs of the foreclosure are included because...yes, they want you to pay it. It could be a more or less, but it is a start. The attorney will want the whole amount, in the form
of a cashier's check, by a certain date. When a judgment in entered in the foreclosure process[foreclosure timeline], the amount goes up everyday. How much?
Another rough calculation:
We take your the mortgage principle, add the approximate
arrearage, multiply that by the interest rate and divide the whole
thing by 360.
For your situation, every day the amount you owe goes up $ 0.00.
Option 2: Refinance. We have only seen ONE example where a client was refinanced in the foreclosure, and that was with a local bank that our client had a 20 year relationship with. In our experience, no matter what your lender says, they will not refinance you. If it happens, please let us know...we will steer clients to that lender!
Option 3: Sell your home. You have some time, several months at least. If the market is generally good in your area, your home is in good shape and the price it could sell for will satisfy your mortgage(s), by all means, try. It is better to get out of a property with a little equity and no foreclosure sale against you.
Option 4: Walk away. Half of everyone foreclosed on in 2003,
walked away from their home. 60 or 70% of those people probably could have kept their home. It is not always possible to save a home. Divorce, significant changes in income or disability all create situations where the best you can do is clean up the loose ends. However, just don't pack and go. The foreclosure process takes many
months, months you can use to save some money and deal with your other
debts. Before you leave, see an attorney.
Option 5: Chapter 13.
This scares the wits out of people. It shouldn't. It is a tool that
allows people to get a second chance. And in experienced hands, better
than 90% of the people that take this option, stay in their homes. You owe it to yourself to at least talk about it.
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