As the housing market and economy at large continue to struggle in various ways, more and more homeowners are finding themselves facing foreclosure. The whole process can be quite confusing and different lending agencies and banks use different language to talk about the process. You may have heard of being “behind on your mortgage,” “being foreclosed on,” or even “pre-foreclosure.” It can be difficult to understand what all these terms mean.
Understanding Pre-Foreclosure in Corpus Christi, Texas
When a homeowner falls behind on a mortgage by at least three months (can be longer depending on your mortgage agreement), this can be referred to as the “pre-foreclosure period.” Though there is no legal standard on this, most lenders will notify a borrower that they have a limited time to make the loan payments current or they will foreclose on the property. This period, or the pre-foreclosure period, is typically three months.
After the pre-foreclosure period, if no payment has been made, the bank or lending agency will assume ownership of the home and auction it off to the public. If they must, they will even evict the homeowner. This is why it’s pretty crucial to understand that being in pre-foreclosure means you still have multiple options available to you to avoid eviction and having your home repossessed.
Options Available to Homeowners in Pre-Foreclosure
The first thing that will happen when you fall behind on mortgage payments on your home in Corpus Christi is that your bank or lender will send you a “notice of default.” This is the official document that states you’ve fallen behind by 3 – 6 months (stipulated by your specific mortgage agreement). When you receive this notification, the pre-foreclosure period has begun.
You have four basic options that may be available to you, depending on your situation:
- Option #1: The best thing you can do is only available if you haven’t yet fallen behind on your payments. If this is the case, you may simply be able to have your mortgage refinanced based on the current value and remaining balance of your mortgage. Your best bet would be to speak with a reputable mortgage broker who works in Corpus Christi. If you need help finding one, ACF Buys Homes would be glad to connect you with one we know to be reputable.
- Option #2: You can explore selling your home to a reputable home buyer in Corpus Christi like ACF Buys Homes. In this case, you can use the proceeds from the sale of the house to pay off the balance of the loan. In some cases, ACF Buys Homes can even work something out on your behalf with your lender.
- Option #3: Convince your bank to allow you to make a short sale. A short sale is a sale where you accept less than the home is worth, and the bank accepts this amount while using the amount lost as a tax write-off. Some short sales require you to pay the difference back yourself, so be sure to read the fine print on any short sale your lender agrees to.
- Option #4: Another final option is to declare bankruptcy. This will allow you to repay your debt but will remain a stain on your credit score for years to come, hurting it significantly. Typically, foreclosures drop your credit score by 200-400 points and will make any lender stay away from you for at least 5 – 8 years.
Most lenders in the Corpus Christi area are extremely aware of the widespread financial troubles homeowners in the nation have experienced in recent years. Taking every chance to communicate honestly with them about your situation may be the key to getting to stay in your home. If not that, at least help you salvage your credit score so you can think about buying a house again when your finances are more secure.
How ACF Buys Homes Can Help During Pre-Foreclosure
- We can provide much-needed guidance and expertise on how to navigate the process so you can stop guessing at the best thing to do. There is no cost or obligation to talk to us for advice. Just give us a call and we will do our best to help.
- We can buy your house in the Corpus Christi area. We buy houses for cash and can close in about a week. We even buy houses in pre-foreclosure.
- We can sometimes even help with a short sale. Just submit your info to the form on this site and we will let you know what we can do.
Remember, pre-foreclosure means you still have time to act. The worst thing to do is to do nothing. Start by calling our office at 361-223-6198 today. There is no cost or obligation to get advice or receive an offer from us on your property in Corpus Christi. You have nothing to lose, call today and let us help.