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| Realty Investment Group |
FAQ's
1. What is foreclosure?
The legal process that banks and mortgage companies use to force the sale of your home to repay a
debt; usually the mortgage on your home. Even if one payment is missed the lending institution can take
the property back and then sell it to repay the money owed them. A foreclosure notice is typically filed
after three or four payments are missed.
2. What is the foreclosure process and how long does it take?
Each state governs the foreclosure process differently. As a minimum, the law requires that the
borrower receive sufficient warning or notice before the foreclosure can take place. Other rights and
responsibilities may be outlined in the mortgage or loan documents you signed when you purchased
the home.
3. Do I have any options and if so, how much time do I have to exercise my options?
You have several options available to you as long as you own your home. Once your house is sold,
whether by you or through foreclosure, many of your options disappear.
Knowing what your options are puts you in a much stronger position to deal effectively with the
foreclosure process. Armed with the right information, you may be able to save your credit from showing
a foreclosure and, in some instances, avoid the foreclosure process altogether.
4. I get letters and notices from people claiming they can help me save my home - are they for real?
When foreclosure documents are filed they become a matter of public record and many people review
these records for various purposes such as compiling lists to sell to bankruptcy attorneys, investors,
real estate professionals and other people interested in either purchasing your home or . . . helping you
save it.
Some of these offers are probably legitimate. See more information below on scams and how to avoid
them.
5. I would rather sell my home than lose it to foreclosure . . . is this possible?
Yes! It's called the Compromise Sale or the "Short Sale" and a foreclosure notice does not prohibit you
from selling your home as long as you own it. However, you must act quickly and select the right real
estate professional, one well versed in these types of sale
6. I don't want to keep the house nor bother with trying to sell it. What would happen if I just walked
away?
There is a legal process for walking away from your home or forfeiting your property. You should seek
the advice of an attorney and a real estate professional well versed in this area because you could face
catastrophic consequences if you just walk away.
7. What happens when the bank forecloses?
While the actual process may vary from state to state, typically a trustee is appointed and announces the
sale by auction of your home by informing the public. The usual announcement includes the name of the
lending institution, who the borrower(s) is/are, the amount of overdue debt, and your total indebtedness.
After a specific period of time, the trustee opens the bidding process, (in some states your lending
institution may do this). Then, either someone purchases the property or it reverts back to the lending
institution. Once the property is sold or reverts back to the lender, the eviction process begins!
8. What does “Short Payoff” mean?
Your lender agrees to accept less than the total owed in exchange for releasing the mortgage as a lien
on the property. (It’s also called pre-foreclosure sale, short sale, pre-sale and compromise sale).
9. Can they sell my house for less than what I owe?
Yes! Banks are not in the business of owning or selling homes and they do not like to foreclose on
property because it's expensive and they usually lose money. They must prepare the home for sale, hire
a real estate agent to sell it, and until it's sold, it remains a non-producing asset on their books. The
lending institution would rather take a loss on the home than have it remain on their books as a non-
producing asset.
10. If I'm evicted, how many days notice do I get?
Typically you'll get 3 days notice! Most banks will start the eviction process immediately after the
foreclosure process but the FHA, HUD and VA are usually much slower. If you own rental property, your
tenants will normally be given 30 days notice. If you need more time than given, contact your lending
institution immediately to ask for an extension.
11. Do I really stand a chance of saving my home from foreclosure?
Yes! If you’re willing to fight for it. Knowing and understanding what options are available to you is the
first step. The best option is the short sale. Other options include bankruptcy, refinancing and
reinstatement of the loan using one of these options.
Your success depends on you implementing the proper option in a timely manner.
12. I've missed a few mortgage payments, now what happens?
Foreclosure may occur. This is the legal means that your lender can use to repossess (take over) your
home.
When the actual foreclosure happens you must move or you'll be evicted anyway. Also, you may still owe
the lender if they sell the house for less than you owe. You do have several options but because
foreclosure or a deficiency judgment could seriously affect your ability to qualify for credit in the future,
you should avoid foreclosure it if all possible!
13. I received a foreclosure notice, what should I do?
1. Contact your lender immediately; explain your situation and why you are having trouble making
your payments. Do not ignore the letter!
2. Do not move out of your home! If you do, it may be considered abandoned and cause you to not
qualify for assistance.
3. Contact a HUD-approved housing counseling agency. Call (800) 569-4287 or TDD (800) 877-
8339 or go online for the housing counseling agency nearest you. These services are usually free of
charge.
4. If you bought your home with a Veterans Administration (VA) guaranteed loan, see Veterans
Services for more information or call the VA office nearest you.
14. So, what are the main points I should know about Foreclosure?
• Don't lose your home and damage your credit history if you can help it.
• Call or write your mortgage lender immediately.
• Stay in your home to make sure you qualify for assistance.
• Arrange an appointment with a HUD-approved housing counselor to explore your options.
• Cooperate with the counselor or lender trying to help you.
• Explore every alternative to losing your home.
• Beware of scams.
• Remember that signing over the deed to someone else does not necessarily relieve you of your
loan obligation.
Scams To Avoid
Like many things out there, there will be people waiting to take advantage of you. The best way to prevent
such things from happening is to arm your self with knowledge. Scams with Foreclosures are no
different.
Below are some common scams you might encounter:
Phantom help: The "rescuer" charges outrageous fees for light-duty phone calls or paperwork that the
homeowner could easily do, none of which results in saving the home. This predatory scam gives
homeowners a false sense of hope and prevents them from seeking qualified help.
The bailout: In this scam, the homeowner is deceived into signing over title with the belief that he will be
able to remain in the house as a renter and eventually buy it back over time. The terms of these scams
are so onerous that the buy-back becomes impossible, the homeowner loses possession, and the
"rescuer" walks off with most or all of the equity.
The bait-and-switch: In this scam, the homeowners think they are signing documents to bring the
mortgage current, but instead actually surrender their ownership. They usually don't even know they've
been scammed until they're evicted.
Follow these tips from the National Consumer Law Center to help prevent these scams from happening
to you:
• Don't panic. Get detailed information about the deadlines you face in resolving your problems. Pay
special attention to the date on which you would lose legal right to ownership.
• Never sign a contract under pressure. Take your time, and consult a lawyer if possible.
• Never sign away ownership via a quitclaim deed or other means without consulting a lawyer. Be
especially suspicious of offers to lease back your home, in order to buy it back over time. These offers
are weighted against you.
• Never make your mortgage payments to anyone other than your lender. If you can't pay, do not ignore
warning letters from your lender; contact them instead.
• Beware of any home-sale contract in which you are not formally released from liability for your
mortgage. Make sure you know the rights you are giving up and that you agree to give them up.
• If you do not speak English, never use a "rescuers" translator. Instead, insist on using your own
translator.
Source: National Consumer Law Center
1. What is foreclosure?
The legal process that banks and mortgage companies use to force the sale of your home to repay a
debt; usually the mortgage on your home. Even if one payment is missed the lending institution can take
the property back and then sell it to repay the money owed them. A foreclosure notice is typically filed
after three or four payments are missed.
2. What is the foreclosure process and how long does it take?
Each state governs the foreclosure process differently. As a minimum, the law requires that the
borrower receive sufficient warning or notice before the foreclosure can take place. Other rights and
responsibilities may be outlined in the mortgage or loan documents you signed when you purchased
the home.
3. Do I have any options and if so, how much time do I have to exercise my options?
You have several options available to you as long as you own your home. Once your house is sold,
whether by you or through foreclosure, many of your options disappear.
Knowing what your options are puts you in a much stronger position to deal effectively with the
foreclosure process. Armed with the right information, you may be able to save your credit from showing
a foreclosure and, in some instances, avoid the foreclosure process altogether.
4. I get letters and notices from people claiming they can help me save my home - are they for real?
When foreclosure documents are filed they become a matter of public record and many people review
these records for various purposes such as compiling lists to sell to bankruptcy attorneys, investors,
real estate professionals and other people interested in either purchasing your home or . . . helping you
save it.
Some of these offers are probably legitimate. See more information below on scams and how to avoid
them.
5. I would rather sell my home than lose it to foreclosure . . . is this possible?
Yes! It's called the Compromise Sale or the "Short Sale" and a foreclosure notice does not prohibit you
from selling your home as long as you own it. However, you must act quickly and select the right real
estate professional, one well versed in these types of sale
6. I don't want to keep the house nor bother with trying to sell it. What would happen if I just walked
away?
There is a legal process for walking away from your home or forfeiting your property. You should seek
the advice of an attorney and a real estate professional well versed in this area because you could face
catastrophic consequences if you just walk away.
7. What happens when the bank forecloses?
While the actual process may vary from state to state, typically a trustee is appointed and announces the
sale by auction of your home by informing the public. The usual announcement includes the name of the
lending institution, who the borrower(s) is/are, the amount of overdue debt, and your total indebtedness.
After a specific period of time, the trustee opens the bidding process, (in some states your lending
institution may do this). Then, either someone purchases the property or it reverts back to the lending
institution. Once the property is sold or reverts back to the lender, the eviction process begins!
8. What does “Short Payoff” mean?
Your lender agrees to accept less than the total owed in exchange for releasing the mortgage as a lien
on the property. (It’s also called pre-foreclosure sale, short sale, pre-sale and compromise sale).
9. Can they sell my house for less than what I owe?
Yes! Banks are not in the business of owning or selling homes and they do not like to foreclose on
property because it's expensive and they usually lose money. They must prepare the home for sale, hire
a real estate agent to sell it, and until it's sold, it remains a non-producing asset on their books. The
lending institution would rather take a loss on the home than have it remain on their books as a non-
producing asset.
10. If I'm evicted, how many days notice do I get?
Typically you'll get 3 days notice! Most banks will start the eviction process immediately after the
foreclosure process but the FHA, HUD and VA are usually much slower. If you own rental property, your
tenants will normally be given 30 days notice. If you need more time than given, contact your lending
institution immediately to ask for an extension.
11. Do I really stand a chance of saving my home from foreclosure?
Yes! If you’re willing to fight for it. Knowing and understanding what options are available to you is the
first step. The best option is the short sale. Other options include bankruptcy, refinancing and
reinstatement of the loan using one of these options.
Your success depends on you implementing the proper option in a timely manner.
12. I've missed a few mortgage payments, now what happens?
Foreclosure may occur. This is the legal means that your lender can use to repossess (take over) your
home.
When the actual foreclosure happens you must move or you'll be evicted anyway. Also, you may still owe
the lender if they sell the house for less than you owe. You do have several options but because
foreclosure or a deficiency judgment could seriously affect your ability to qualify for credit in the future,
you should avoid foreclosure it if all possible!
13. I received a foreclosure notice, what should I do?
1. Contact your lender immediately; explain your situation and why you are having trouble making
your payments. Do not ignore the letter!
2. Do not move out of your home! If you do, it may be considered abandoned and cause you to not
qualify for assistance.
3. Contact a HUD-approved housing counseling agency. Call (800) 569-4287 or TDD (800) 877-
8339 or go online for the housing counseling agency nearest you. These services are usually free of
charge.
4. If you bought your home with a Veterans Administration (VA) guaranteed loan, see Veterans
Services for more information or call the VA office nearest you.
14. So, what are the main points I should know about Foreclosure?
• Don't lose your home and damage your credit history if you can help it.
• Call or write your mortgage lender immediately.
• Stay in your home to make sure you qualify for assistance.
• Arrange an appointment with a HUD-approved housing counselor to explore your options.
• Cooperate with the counselor or lender trying to help you.
• Explore every alternative to losing your home.
• Beware of scams.
• Remember that signing over the deed to someone else does not necessarily relieve you of your
loan obligation.
Scams To Avoid
Like many things out there, there will be people waiting to take advantage of you. The best way to prevent
such things from happening is to arm your self with knowledge. Scams with Foreclosures are no
different.
Below are some common scams you might encounter:
Phantom help: The "rescuer" charges outrageous fees for light-duty phone calls or paperwork that the
homeowner could easily do, none of which results in saving the home. This predatory scam gives
homeowners a false sense of hope and prevents them from seeking qualified help.
The bailout: In this scam, the homeowner is deceived into signing over title with the belief that he will be
able to remain in the house as a renter and eventually buy it back over time. The terms of these scams
are so onerous that the buy-back becomes impossible, the homeowner loses possession, and the
"rescuer" walks off with most or all of the equity.
The bait-and-switch: In this scam, the homeowners think they are signing documents to bring the
mortgage current, but instead actually surrender their ownership. They usually don't even know they've
been scammed until they're evicted.
Follow these tips from the National Consumer Law Center to help prevent these scams from happening
to you:
• Don't panic. Get detailed information about the deadlines you face in resolving your problems. Pay
special attention to the date on which you would lose legal right to ownership.
• Never sign a contract under pressure. Take your time, and consult a lawyer if possible.
• Never sign away ownership via a quitclaim deed or other means without consulting a lawyer. Be
especially suspicious of offers to lease back your home, in order to buy it back over time. These offers
are weighted against you.
• Never make your mortgage payments to anyone other than your lender. If you can't pay, do not ignore
warning letters from your lender; contact them instead.
• Beware of any home-sale contract in which you are not formally released from liability for your
mortgage. Make sure you know the rights you are giving up and that you agree to give them up.
• If you do not speak English, never use a "rescuers" translator. Instead, insist on using your own
translator.
Source: National Consumer Law Center
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| We have helped hundreds of people just like you to avoid foreclosure. Contact us today! Realty Investment Group 770-694-6500 |
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| Copyright 2009 R.I.G. of Georgia |