What to do if you're behind on your mortgage payments?

MARLBOROUGH, Mass. - March 28, 2017 - PRLog -- Are you in financial distress because of your mortgage?

"Once people get behind on payments, it's like falling into a well with no ladder," says John Kreiss, a Central Mass REALTOR, who works closely with people having trouble paying their mortgages,

It's stressful and people often feel embarrassed.  But they're not alone.  Many people find themselves in these situations due to job losses, adjustable mortgage rates, disability, healthcare bills, etc. There are, however, ways to handle these challenges to prevent additional problems down the road.

You can:

File bankruptcy

Let the bank foreclose

List your home as a short sale

Apply for a loan modification

Refinance

Contact a credit counselor and get assistance with renegotiation

Sell to an investor

Bankruptcy has helped some consumers. The courts now have the authority to let you keep your home and either forgive a portion of your debt or modify the terms so you can make the payments. If you're also buried in medical bills, credit card debt, or other obligations you simply can't meet, this might be the best solution. But... bankruptcy stays on your credit report for 10 years and could keep you from moving forward in life. In addition, it places some restrictions on your life that you might find very unpleasant. It might not be the best choice for you.

Foreclosure is another option. You can simply quit making the payments and stay there until they knock on the door and tell you the bank now owns your home. For some this is a chance to live rent and payment free for several months and put away some money for a deposit on a rental home. But again - the effect on your credit rating is dire.

In addition, you run the risk of a huge financial obligation that will follow you around forever. When the bank sells your house at a loss because the market has fallen, they might be able to come back on you to make up the "deficiency" between your mortgage balance and the dollars they collected from the sale of the house. This is another area where the rules keep changing, so check this before you act.

If done correctly, a Short Sale could be the best option for you. You list and sell the house for the current fair market value and walk away with no money, but a fresh start. At least, that's what will happen if you list the house with an agent who is experienced in handling successful short sales.

The truth is, your lender can also come back to you for a deficiency in a short sale. It's one of those details that must be negotiated with the asset manager and the lender before you sign the closing papers.

Unfortunately, many real estate agents today are listing short sale properties without knowing how to conduct that negotiation, and their sellers are paying the price for that lack of knowledge.

In other cases, listings that begin as short sales end up going into foreclosure.

Why? Again - because the agent lacked experience and knowledge.

Success in a short sale relies on 3 primary areas of expertise: Pricing, Paperwork, and Persistence. Before you list with any agent you need to know that he or she is skilled in all three areas.

Kreiss says that the worst thing people can do is put there head in the sand and hope that the problem goes away,  because it will only get worse.

"I've seen lots of people, who shouldn't have lost their homes to foreclosure, but ended up giving the home back to the lender because they didn't know what to do.  And often they're embarrassed.  There is help available. "

There are a number of people who can help.  Lenders would prefer not to foreclose, and may be willing to modify loan payments, but the homeowner needs to all.  The sooner the better.  Real Estate Agents and Attorneys are good resources to talk to should you ever be in the situation where you've fallen behind on your mortgage payments, or owe more than the fair market value of the property.

http://site226983.myrealestateplatform.com/