Foreclosures are a big deal. Whether you fell behind on your mortgage or property taxes, the banks don’t really care about that. Read below the 9 tips on how to avoid foreclosure in Arizona:
• Reinstatement: According to foreclosure experts in Arizona, reinstatement is one of the most difficult options to be achieved by a house owner. It includes paying the debt amount to the lender with late fees after the due date. You don’t need the approval of your lender and your mortgage will be reinstated until the foreclosure.
• Mortgage Modification: Sometimes, the lender may allow a modification. But, these changes are subject to the approval of your lender. With a mortgage modification, the payments may become more comfortable for you, but the overall loan may still be underwater.
• Short Sale: Short sales are usually the best option for homeowners in Arizona. The damage you can limit to your credit score by getting out from under your home quickly can actually benefit you in the long run. You may not see it now, but sometimes even after the 7 year period, you still may not be able to get a loan.
• Repayment Plan: In the process of trying to stop foreclosure in Arizona, repayment plan can help you in a great manner. Under this plan, the lender allows you to pay the missed payments over a period of time (12 months or more). In short, you can make the repayment along with the current mortgage payments. You need to get the approval of your lender for this option. It is also called as forbearance.
• Rent your house: Renting out your house to tenants can be another way to stop foreclosure in Arizona. Allowing people to pay your monthly mortgage (their rent) is what tons of landlords are doing.
• File bankruptcy: Although most people get embarrassed of this, filing for bankruptcy can stop any bill collectors and the foreclosure process from happening. This should be considered a last resort if none of your other options pan out.
• Sell your property: Do you enough equity left? If yes, then it is best to sell the property with an experience pre-foreclosure agent. The sad news is that most of the homeowners owe much more than the current value of their property.
• Deed-in-Lieu of Foreclosure: This is undoubtedly the best method for your distressed property. You can return the property to your lender itself and vacate the property. Although, you need the approval of your lender before initiating the process. But keep in mind that a deed-in-lieu may still destroy your credit rating and eligibility for loans in the future. On the contrary, it may provoke the right of the lender to file a deficiency judgement against the house owner.
• Refinance: If you have eligibility for a new loan, the law allows you to apply for a loan to repay your current mortgage. If you have missed your mortgage payment in the past, it will be difficult to get an additional loan.