EDUCATIONAL: How Do I Save My Home From Foreclosure in Nevada?
A Foreclosure: can take as little as three (3) months after mortgage payments stop. You can call your bank or lender to see if they will reinstate the loan. This may be possible by paying a lump sum or making scheduled payments to your lender. Just explain to them you had a few bad months and things are now better and most lenders will try to work it out.
Forbearance Agreement: This is when you actually negotiate a "deal" with your lender. You can ask the bank if they will add on the amount owed in back payments to the back of the loan. You might ask if the lender would be willing to take a smaller portion upfront and add the rest to the back of the loan. Or pay some funds upfront and forgive the rest. Perhaps even ask to forgive the whole thing. You never know unless you ask. Lenders would rather work with you than wait for someone to default.
You can Refinance: If there is lots of equity in your home this is a great option. Usually the lender would refinance the existing loan and include as part of the new loan any late payments, and fees that you would need to regain control. It would all be "wrapped" into one mortgage. The challenge that most homeowners have is they have leveraged their home to the max. Therefore, very little equity is in the home especially when you add on back payments and fees so it becomes very difficult to refinance.
Call a Realtor: If you have equity in the property this can be a great option. However, if you have very little equity, it is very hard to sell homes with real estate agents. Remember, you have to pay a realtor fee or commission if they list your house. Typically it's 4-6% of the purchase price. They may increase the purchase price of the home to compensate for the commission and now it becomes practically impossible to sell your house when it's at or over market value in such a short time. Plus, buyers cannot qualify for loans if the home is selling for more than what it's worth.
FSBO: You can sell the house yourself. This would be one time one should really consider a Realtor
Give the property back to the lender: If there are no other liens on the title, the lender may agree to take the property back. Transferring ownership from you to the lender is called a Deed in Lieu of Foreclosure. A deed in lieu of foreclosure will not protect your credit, nor will it stop junior lien holders. The lender would take the property back subject to the junior lien holders. This will avoid the possibility of a deficiency judgment in the event the property fails to produce enough to cover the outstanding debts after it goes to auction. You give up all rights to receive any proceeds from the auction.
Short Sale: This allows someone to buy your home under market value so you can avoid the foreclosure auction. This can help you move, get you into a new dwelling that will fit your budget and if the buyer is willing to "split" the equity between the buyer and seller, you can still walk away with some cash. A Realtor can help you with this. However, you want to watch out for scams like "Equity Skimming" According to HUD, In this type of scam, a "buyer" approaches you, offering to get you out of financial trouble by promising to pay off your mortgage or give you a sum of money when the property is sold. The "buyer" may suggest that you move out quickly and deed the property to him or her. The "buyer" then collects rent for a time, does not make any mortgage payments, and allows the lender to foreclose. Remember, signing over your deed to someone else does not necessarily relieve you of your obligation on your loan.
Allow the Foreclosure: Basically you don't do anything. Typically you will get evicted after about 2-3 weeks. You leave with nothing in hand and a foreclosure on your credit report. With an eviction on your record, it will be unlikely that you ever rent a nice apartment or home later. It is just as unlikely that you will ever find another lender to help you another home when times get better. Don't let anyone convince you to just give up and do nothing. It could mean the difference between a few thousand dollars in your pocket compared to nothing and a foreclosure and an eviction on your credit records. These are permanent.
Soldier Relief Act of 1940: When a property is owned by military personnel and the mortgage payments are not made, then this relief act may stop foreclosure based on certain criteria. The person has to be on active duty in order to qualify. The mortgage loan had to be established before the soldier was called out to active duty. Not only will this stop foreclosure, but it will stop seizure of any personal property while the soldier is actively serving.
Get the Best Escrow Officer you Can Find! Time is of the essence. If you are able to find a buyer with or without a Realtor, Make sure your Escrow Officer has all documentation including all mail correspondence from the lender to the seller. You want the escrow to close on or before the final due date to prevent the worse case scenario. Remember, if an escrow on average takes 30 days, and many Foreclosures can take three months You want the escrow to close on or before the final due date, This only gives you about 2 months to open escrow unless otherwise noted (some take as long as eleven months.)
Bankruptcy: Consult a bankruptcy lawyer if this is one of your considerations.
If you still have further questions, please consider consulting a Realtor and or a lawyer