Archive for October, 2009
Refinance Possible If No Equity To Avoid Foreclosure?
Posted by: | CommentsOur house in CA was bought for $406,000, now only worth 220,000 due to mortgage mess- we have adjustable rates that will go into affect in 3 years (mortage payment will increase by $1500.00 more a month then) I would like to refi to a fixed rate but we now have no equity- my hubby and I have excellent credit- is it possible???
Avoid Foreclosure – Refinancing Your Home might be the Answer
Posted by: | CommentsMost people think a good way to avoid foreclosure is to start over…..refinance the mortgage and just start over.
The problem is most people cannot refinance.
Stopping foreclosure is very difficult. Unfortunately, you will run into all kinds of mortgage brokers and lenders out there who will tell you what you want to hear and waste your time. Time is something you can’t afford to waste when you are trying to avoid foreclosure. You only have about 4-8 months after missing your first mortgage payment until you lose your house. The foreclosure process varies by state and lender.
Mortgage brokers and lenders have always preyed on people in trouble. There is no way they can get you refinanced but they tell you they can help stop foreclosure. Why would they do that? They don’t get paid if you don’t close so why would they take your application and keep you from looking at other options? Mortgage brokers are trained to just bring in the business…..get as many applications as they can. Some companies even have sales meetings to enforce getting applications even if they don’t close. This would surprise you but mortgage companies live by the rule “throw everything against the wall and see what sticks”. You are in a very scary situation and you are treated like everyone else. You were never going to “stick” in the first place but now a month or two has gone by and you are even farther behind on the mortgage payments.
Some mortgage brokers or lenders make money off of you by taking a fee up front. They know for a fact no one can refinance your mortgage buy they tell you for a fee up front they will start working on your loan. Quite a nice business model don’t you think? They tell you everything you want to hear when you are trying to avoid foreclosure. They collect a fee because you believe them and they move on to the next unsuspecting person. Not another minute will be spent on you after they get your money.
Who can refinance to avoid foreclosure?
You need equity in your home. Depending on how far you are in the process, you need at least 10% to 25% equity in your property. The farther you are in the foreclosure process, the more equity you will need. If you are more than 2 payments behind and you don’t have at least 25% equity, it is almost impossible to refinance. Make sure when you are calculating the equity you factor in all the late fees and legal fees.
Speaking of how far along you are in the foreclosure process, that makes a huge difference when refinancing. Once you are more than 90 days late on your mortgage, everything changes. The rate will dramatically change if you can even refinance at all after that point. That is why it is so important to pick the right mortgage broker or lender because if they are not experienced in these types of loans, they can take too long and you will pass the point of no return.
Some private party lenders may be able to refinance you to avoid foreclosure. These are typically known as hard money lenders. They decide if they will lend you the money personally. There are no underwriting guidelines. It is a case by case basis. These can be very expensive. The rate and fees will probably be so high you won’t be able to afford it.
That brings up an important point. Even if you can refinance, what is your new payment going to be? If you are having trouble making the payment now, the payment is guaranteed to be more because you are trying to avoid foreclosure by refinancing. Any loan you get will be expensive.
If you do not have equity in your property do not even consider refinancing your home to avoid foreclosure. I hope this article has helped you and you have learned something about stopping foreclosure. If anything I hope you have realized that very few people can help stop foreclosure. You will end up wasting valuable time and money to find out no one can help you.
Good Luck!
Any Suggestions On Getting Out Of Debt, Loans To Avoid Foreclosure?
Posted by: | CommentsNewly divorsed, just sold house thats behind in payments, owe more than it was sold for
Avoid Foreclosure – Market Your House For Sale By Owner
Posted by: | CommentsWhen facing foreclosure you can attempt to market your home For Sale By Owner or FSBO as it is said in the real estate industry. This will allow you to not pay real estate agent fees and still be open for a foreclosure real estate investor to purchase your home if need be.
When marketing your “for sale by owner” home, there are three essential elements for a successful marketing campaign. The first is headline that will grab the attention of your prospects. When writing your headline, use the features of your home in the headline, such as “Split Floor Plan, The Kids Won’t Hear!” (that’s if you are daring) or something a bit more conservative “Beautiful Home Needs Loving Family” You want your headline to be explosive enough to catch the potential home shopper’s attention. You want them to read your ad about your home. By being different than the other headlines you will more than likely have more readers.
Another element is to highlight one of the properties best features, such as an ocean view, recently remodeled or within walking distance of schools. You want to give reason for the prospect to actually want to see your home. If you have space, show the benefit as well. “Recently remodeled so you don’t have to” Or, “Walking Distance of Schools, You can sleep in” This will give them even more reason to want to look at your home before making a final purchase. Having witty headlines again, will allow you to stand out and above the others.
A good closing line will prompt the potential buyer to call. You will want to appeal to their desire to own a home, or maybe as a good investment, or even their sense of urgency. “See it Now, before it is gone!” or “Don’t pay your landlord another dime!” are just some examples. Once you have your ad completed, you will submit it to your local newspaper.
Another effective method of marketing is by having an “Open House”. In order to have the best open house, be sure to have your home clean and clear of clutter. Take down the personal pictures so others can imagine themselves living in the house. Being that you are avoiding foreclosure, I understand that money may be tight, but if you are able complete any minor repairs that are visible.
Make up flyers so everyone who attends your open house will get a flyer before they leave. The flyers should be an 8 1/2 x 11 inch fact sheet describing your home, the asking price and numbers on how you can be reached as well as your website if you are marketing on your web page with pictures. The flyers should also list your price and describe the property. Also be sure to have the local schools and other amenities in the area listed on the flyer.
You can also attach these flyers under windshield wipers of cars, and attach flyers about your “Open House” to neighborhood mailboxes. Do Not Place Anything Inside a Mailbox! It is against the law.
When you schedule the “Open House”, be sure to schedule it for a Saturday or Sunday between 11 AM – 5 PM. Also be sure to check your calendar to ensure your “Open House” is not competing with any kind of major sports playoffs or any major religious holidays.
You might want to place an “Open House” sign in your front yard with balloons attached. If you are on a street with not a lot of drive by traffic, you may want to use some signs on prominent corners with arrows pointing the direction to your house.
Ensure you have a guest book so you can get the names, phone numbers and emails of every person who attends. If you can, make sure to take notes, and write down every positive impression and comment made by those who attended. Also write down anything that’s constructive that you can change to make the house show better. You will want to be able to keep in touch of people who show an interest. This could be especially important if you reduce your asking price or change the terms of the sale later on.
Another finishing touch for your Open House is to have cookies and water or lemonade available. It may sound hokey, but folks will feel like they are home, which is what you want.
Again, if you are facing foreclosure and want to sell your home, selling it “For Sale By Owner” may be the route to go. If you find that time is of the essence you can always contact a real estate investor that likes to purchase home that are facing foreclosure. Usually, they are able to move fast and offer a fair price.
Angela Karolyn Scott bought her first home at the age of 22 as a single mother with no money down. She is now on a mission to teach others how to create wealth by way of Real Estate. She is giving away a $300,000 house, a Mercedes C Class and a Mercury Mariner SUV Hybrid. You may learn more by visiting www.ForeclosuresMakeYouRich.com
A friend of mine told that this was true in Texas where we live. She said that the buy the house from the mortgage holder and lease it back to the home owner with the option to purchase it back typically within a year. She says this allows the home owner to reestablish their credit score. Is this true.