![]() If you are already struggling with payments and foreclosure has already begun, it still may not be too late to take action.You may also be able to receive some of the money to help with your moving costs or to pay off other lien holders. If the amount for which you can sell your house isn't enough to cover the balance of your loan, the lender may agree to accept a reduced amount in a "short payoff" or "pre-foreclosure sale." A short sale allows for full discharge of debt and will affect your credit for two years.A Realtor may be able to inform you of all of your options based on your current situation. Find out how much you can get for your home. Contact a Realtor experienced with short sales before foreclosure begins. Once you reaffirm, you will be expected to bring the mortgage current unless there are other provisions in place, such as forbearance or refinance, or loan re-modification. ![]() X Research source You must reaffirm the mortgage before the bankruptcy is discharged. Reaffirmation is an agreement with the mortgage lender that states you will continue your monthly payments during and after bankruptcy. If you file bankruptcy and want to keep your home then you can reaffirm your loan with the lender.If your credit score has risen enough, you may be able to get a home loan after two years of a bankruptcy. While it can stay on your record for several years, credit scores typically improve after the bankruptcy because the debtor has been provided relief from the debt burden. The damage to your credit score only occurs when you file for bankruptcy.X Research source This can buy you some time to get current on your mortgage payments. If you file for bankruptcy, however, your lender can’t foreclose while your bankruptcy is pending. Your credit score will be damaged when you file for bankruptcy, and it can stay on your record for up to ten years.
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