| The majority of people would like to find ways to | | | | homeowner or an obligation of the lender. |
| keep their homes safe from the foreclosure sale. | | | | - Deed in Lieu of Foreclosure - This strategy |
| Additionally, they may not desire to retain | | | | consists of giving the property back, sometimes |
| ownership of the property. If this fits you, here | | | | called deeding the property, to your lender prior |
| are some ways to dispose of the property in | | | | to the foreclosure sale. Like a short sale, the |
| order to prevent a foreclosure sale. These | | | | lender is not obligated to do this. And, if they do, |
| options will affect your credit rating a lot less than | | | | you should have enough equity to where the sale |
| the actual foreclosure. | | | | covers the loan. If not, your lender may not |
| - Selling the Property - This strategy to avoiding | | | | approve or you could trigger another taxable |
| foreclosure involves simply selling the home for a | | | | event on the difference. |
| profit. Typically, this is a viable option when you | | | | The key to disposing your property is to act fast. |
| have equity, the property is marketable, and you | | | | In this case, do not expect to fetch top dollar |
| are in a desirable area. You may work with a real | | | | because the buyer, if they know the reasons for |
| estate agent whom you trust or sell the property | | | | the sale, will want a discount. In many cases, if |
| yourself. | | | | your objective is to avoid the foreclosure sale, |
| - Sell the Property via an Assumption - This | | | | you may have to accept what you are offered. |
| strategy to avoiding foreclosure involves finding a | | | | Your most probable buyer will be an investor who |
| buyer who will assume your loan, move into your | | | | has the funds to close and do it quickly. You will |
| property, and continue making mortgage | | | | release more equity than you would like. |
| payments to your lender. FHA and VA loans are | | | | However, you will avoid a foreclosure on your |
| assumable. However, you want to make sure | | | | record. |
| your lender will absolve you from any and all | | | | In summary, it's never a good idea to give up |
| responsibility once the buyer has assumed your | | | | your home. In some situations, this is your only |
| loan. | | | | option to protect yourself from a foreclosure by |
| - Pre-Foreclosure Sale or Short Selling - This | | | | unloading the property to an investor; thus, paying |
| option allows the homeowner to sell the property | | | | the entire mortgage loan off quickly. |
| for less than the loan amount. Be aware of the | | | | Unfortunately, if you wait and the lender takes |
| following: 1) this may trigger a taxable event for | | | | your home, you will get far less for it than you |
| the homeowner on the difference between the | | | | deserve and may still end up owing money to the |
| amount of the sale and the loan, and 2) this is a | | | | lender. |
| courtesy of your lender, not a right of the | | | | |