Georgia Is A "Fast Track" Foreclosure State - Count On It

When you fall behind on your mortgage, there are only four basic resolutions to your situation:

• Cure the default - bring your mortgage current
• Negotiate a loan forbearance or modification
• Negotiate a short sale
• Surrender the deed or the lender forecloses

Lets take a quick look at each one.

If you are able to bring your mortgage current, and the circumstances that caused you to fall behind are no longer present - this is the best solution. Your credit rating will suffer a little because you fell behind… but by bringing your mortgage current and making the future payments on time, you can rebuld your credit rating.

If you can not bring your mortgage current - but the  circumstances that caused you to fall behind are no longer present - you might be able to negotiate a loan forbearance or modification. A forbearance allows you to resume making your normal monthly mortgage payments - with an additional partial payment for several months until your delinquency is eliminated.

For example, if you were three months behind, and the bank allowed you to make a payment equal to one and a half payments each month - you would make an extra half a month payment for six months.

A loan modification  would actually change the terms of your mortgage - for example, your deliquency could be added to the back of the loan, extending your mortgage to a later date.

If those options won’t work for you, it’s time to consider a short sale. A short sale occurs when a property is sold and the lender agrees to release their lien for an amount that is less than what is owed - a procedure that just happens to be our specialty. If you truly can not afford to keep your home - chances are that you’re eligible for a short sale.

A good short sale deal is the lesser of two evils to your bank, so as long as a short sale makes more financial sense than a foreclosure - there’s a good chance they will agree NOT to pursue you in the future with a deficiency judgment. On the other hand, if you should let your home go into foreclosure - you can count on them seeking a deficiency judgment.

If you are unable to sell your property by short sale prior to foreclosure, and you only have one lien holder, then you might be able to surrender the deed to the lender in what is called a Deed In Lieu Of Foreclosure. This is a voluntary foreclosure, whereby you are giving the bank immediate control of the property. By surrendering the deed - along with a broom-clean property - you’ll reduce the expenses that the bank will eventually sue you for.

Since you are much better off by avoiding the foreclosure, let me take a moment to describe how we can help. We’ll first assess your current situation and your desires. Based upon our assessment, we’ll determine the best way to help. We may refer you to a law firm that specializes in loan modifications. We may bring in an investor to place an immediate offer to stop the foreclosure - or initiate the process. There are several options that can all accomplish the same goal of helping you avoid foreclosure through a short sale.

To get started with your assessment, call our Finance Specialist Cindy McDanel at 770-572-7002 and tell her about your particular situation.

As always, if you have any questions regarding real estate in the greater Atlanta area, feel free to contact me here.

Posted by Doug Quance on Saturday, January 3rd, 2009 at 7:30 pm.