How to Sell a House to Avoid Foreclosure
If a homeowner is significantly behind on their mortgage payments and facing foreclosure, they might be wondering if there's any way to get out. Is it possible to avoid foreclosure by selling the home? Or they may have fallen behind, know that they have no way to catch up, and want to prevent the process of foreclosure at all.
What Are the Options?
In either of these scenarios, there are options to sell the home to avoid foreclosure. One option is a short sale through a regular real estate agent, albeit one with specific experience in selling homes at risk of foreclosure or already somewhere in the process of an active foreclosure. The other option is selling to a home investor company that can give a fast cash offer to help avoid a completed foreclosure.
Why It's Important to Avoid Foreclosure
Foreclosure means more than just losing a house and walking away with nothing. There's also the loss of equity in the home. It's a black mark on a credit report that remains on record for seven years. It also lowers the credit score by as much as 150 points. It will make it difficult to buy another house and even make it hard to rent an apartment, condo, or house. It also makes it challenging to secure a new loan to purchase another house, condo, or apartment.
It's not just about avoiding the hardship of losing a house. Preventing foreclosure also means not leaving a home with no funds from a sale, which would help a homeowner start over in a more affordable property and help block the damage to their credit.
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Potential Tax Ramifications From A Foreclosure
A foreclosure also has tax ramifications because the IRS classifies it as a form of debt forgiveness. The amount owed on the house at the time of foreclosure can be considered income by the IRS, which can tax that sum accordingly. This can cost thousands of dollars, depending on how much was owed.
Sell Via Short Sale to Avoid Foreclosure
A short sale is the other option for selling a house to avoid foreclosure. The drawback to a short sale is that even if the house sells at the market rate, money might still be owed on the mortgage that would need to be paid to the bank. The other problem with a short sale is that if the home is already in foreclosure, the bank needs to be contacted to request the approval to sell, and the bank can take up to 120 days to render its decision. With that delay, they can foreclose before the house sells.
Sell to a Home Investor to Avoid Foreclosure
For a homeowner who's struggling with overdue mortgage payments and doesn't have a way to get current, selling the house to a home investor is one of the best options to prevent foreclosure. This pays off the mortgage to the bank and stops a foreclosure in its tracks. Although settling a mortgage this way means they have to give up their house, it's a way to avoid the other negative impacts. Another benefit to selling to a home investor is that it may even result in some money to start the process again.
The advantage of selling your house to home investors at Coveway Properties is that they provide a cash offer within 24 hours. In addition, our experienced professionals can grant the authority to negotiate with the bank, providing more leverage against the bank. Depending on the customer service agent involved, it may prevent the runaround or different answers. Banks and mortgage lenders are not in the business of helping; they're in the business of making money.
Since banks are motivated by money, getting a cash offer will often sway them to approve the sale rather than proceed with foreclosure. After all, this is in their best interest, as they don't want to get stuck with a home. Most banks aren't in the real estate business, so it can cost them $80,000 or more to prepare a house for resale, especially if a place needs repairs. They'd much rather recoup what they can in costs through a cash offer from a trusted home investor.Whether you've fallen behind on your mortgage or are already in the early stages of foreclosure, reach out to the experts at Coveway Properties to see if we can help. We might be able to help you sell your home fast for max profit to avoid foreclosure.
Coveway Properties Is the Solution You Need
When your goal is to get out from under that rental property, Coveway is your solution. We will pay you a fair cash value for your home. Our crew is all in-house, so we can offer more than other companies.
You do not need to worry about having banks involved because we take care of working with the banks for you. The process can be quick and painless. The truth is, you could have your money in as few as 5 business days. Just think about that. One week from now, you could be headache free and your rental property will be someone else's problem.
Here is the whole process in a nutshell. You get an offer based on the current condition of your property. We agree on a fair value and begin the closing process. You get the amount agreed upon at closing and we get the deed. It is easy, and you get your life back.
Getting Started: Sell My House Fast
If you have distressed property on your hands, Coveway Properties can help. Our motivated real estate investment team will give you a cash offer for your home in just 24 hours. Contact us now to get started on your path to freeing yourself from the distressed property.