Your First Resonder
In Real Estate
Each Office Independently Owned and Operated
8100 Ashton Ave #103
Manassas,  VA 20109
Lyle Holmes
Stacey Holmes
Licensed in the
Commonwealth of Virgini
Stace Holmes Realtor Fredericksburg
9 Options When Facing Foreclosure

1. Do Nothing: If you choose to do nothing, you will most likely lose your home. Your credit report will disclose this damaging information for years to come. This is certainly not the best option!

2. Payoff or Refinance: You may pay off the entire loan amount you owe to your bank(s) plus any default amount and fees or you could refinance the current loan. The new loan you get could have a higher interest rate and there may be a pre-payment penalty because of the recent default. The important thing to know is that with this option, there would have to be equity (your home is worth more than you owe) in your home.

3. Reinstatement: You may pay the entire default amount plus interest, attorney fees, late fees, taxes, and missed payments and “reinstate” your loan (bring your loan current).
4. Loan Modification: A loan modification is a permanent change in one or more of the terms of your loan and can sometimes result in a lower payment for you; however, many people do not qualify for this alternative.

5. Forbearance: Forbearance is an agreement made between you and your bank in which your bank agrees not to exercise its legal right to foreclose on your home and in which you agree to a payment plan that will bring you loan current over a certain time period. Information will be required by your bank to show that you are able to meet the new payment plan requirements.

6. Partial Claim: A partial claim is a loan from your bank for a 2nd loan to include back payments, costs and fees. Under the partial claim option, a bank will advance funds on behalf of you in an amount necessary to reinstate a delinquent loan (not to exceed the equivalent of 12 months PITI). The bank will execute a promissory note and subordinate (2nd) mortgage. Such loans are due in full and payable when you either pay off the first mortgage and/or no longer own the property.

7. Deed in Lieu of Foreclosure: A Deed in Lieu of Foreclosure is a disposition option in which you voluntarily deed the home back to your bank in exchange for a release from all obligations under the mortgage. A Deed in Lieu of Foreclosure may not be accepted if the homeowners can financially make their mortgage payments. The consequences of this option are nearly as severe as that of an actual foreclosure and there are certain eligibility requirements for this option as well.

8. Bankruptcy: Bankruptcy is an option that can liquidate debt and/or allow more time for you to stay in your home. There are several types of Bankruptcy and you would need to consult a Bankruptcy attorney for more information…
          -Chapter 7 (Liquidation): Completely settles personal debt.
          -Chapter 13 (Wage Earner Plan): Payments are made toward a plan to pay off debt
                                                                  in 3-5 years.
          -Chapter 11 (Business Reorganization): A business debt solution.

9. Sell the Home: There are two ways for you to sell your home if facing foreclosure… 
a) Sell with Equity: If your home has equity (money left over after all loans and monetary incumbrances are paid), you may sell your home without lender approval through a conventional home sale. In this case, you could get cash from the sale proceeds.
b) Sell with No Equity/Short Sale: If your home does not have equity, it is still possible to sell your home through a  transaction called a Short Sale. Simply put, a Short Sale is used to describe the sale of a home in which the homeowner owes the bank more than the home is worth. The bank agrees to allow the home to be sold for less than what is owed (AKA “Short Sale”) with the help of a Real Estate Professional

The Piedmont Team offers Real Estate services in the following areas:
Culpeper, Fauquier, Fairfax, Fredericksburg, Manassas, Orange,
Prince William, Rappahannock, Spotsylvania and Stafford.
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