There is No Shame in A Short Sale or Loan Modification

Homeowners, If you are underwater and your mortgage payment is more than you can handle, you are not alone.  Everyone knows someone that is in this situation and feeling overwhelmed by the thought of the “F” word – foreclosure.  You may be wondering what you should do and there are a couple of options.

Loan Modification – You may be able to work with your existing lender to negotiate a lower rate or principal balance of your existing mortgages.  The lender wants to be sure that you have the means to pay the loan back and has criteria that needs to be met. 

HUD The U.S. Department of Housing and Urban Development has launched “Keep Your Home. Know Your Loan”,.  campaign to help home owners in crisis. Call the Hud Toll Free Counseling Hot-line at 877-HUD-1515 to arrange face to face meeting with a counselor near you regarding the loan modification process.  I can also refer you to a local non-profit agency.

Short Sale - With this option, you can choose to list and sell your home for less than the amount than you currently owe on your mortgage.  There is some red tape here and it could take some time but if you work with a Realtor(r) that understands the process, you have a good chance coming out of this less bruised then you would a foreclosure.

Foreclosure - This is the worst possible scenario. When a bank forecloses on your home, it can be devastating to your credit and family for years to come.  Just some of the effects that people often don’t realize are associated with foreclosure are:

• Drop in credit score – You credit may affected for seven to 10 years
• Fewer Employment Options - with so many employers doing background checks, a foreclosure on your record may keep you from getting that new job
• Security Clearance – If you have a security clearance, this could also be affected! 

This is a tough time for so many.  There is no shame in having a hardship, a loan adjustment or a major life occurrence that is keeping you from making that mortgage payment and all your other obligations. In fact, most Americans are living month to month and have less than one month’s worth of reserves. A lay off or injury, even for a short time could have devastating effects.

If you would like to hear more about your options and just want someone to talk to about it, I am here to help in anyway I can.  These are the times that Realtors are here to help home owners by educating them on the tough decisions.  There is no cost for this and of course, it is completely confidential.

Cristal Drake – 714-423-7525 – cristaldrake@gmail.com