We provide support & solutions to Families to help Stop Foreclosures
Our Services
- You have Options – Each situation is unique. We offer free consultations to evaluate your unique circumstances for you and your family.
- Keep your home – Our experienced team will help with solutions if you are in a position to arrange a loan modification, refinance or reinstatement.
- Avoid Foreclosure Auction – We can help you with several possible options to sell home on your terms and have relocation funds for a fresh start for you and your family. Often this option can give you more time in the home.
What is best for you?
More detailed information on Options:
A loan modification is a change in the original terms of a homeowner’s mortgage, often including adjustments to the interest rate, the loan term, or the monthly payment amount. The goal of a loan modification is to make the mortgage more affordable for the homeowner, potentially preventing foreclosure. Unlike a refinance, a loan modification doesn’t involve taking out a new loan, which can be appealing to homeowners already struggling financially.
Pros:
- Avoid Foreclosure The primary advantage of a loan modification is that it helps homeowners avoid foreclosure, allowing them to keep their home.
- Fewer Credit Impacts than Foreclosure While a loan modification might slightly impact your credit score, it is far less damaging than a completed foreclosure, which could stay on your credit report for up to seven years. Preventing foreclosure through modification can make it easier to recover financially in the long term.
Cons:
- Lengthy and Complicated Process Applying for a loan modification can be a time-consuming and complex process, especially in Florida’s judicial foreclosure system. Homeowners must gather and submit extensive documentation, including proof of hardship, income verification, and details of their assets. Even then, the lender is not obligated to approve the modification.
- Accrued Interest and Fees Some lenders may capitalize overdue payments, interest, and fees into the modified loan balance. The overall cost of the loan could rise significantly.
- No Guaranteed Approval
- mpact on Credit Score While loan modification is less damaging to your credit than foreclosure, it’s important to note that missed payments during the pre-foreclosure process can still hurt your credit score.
- Potential for Negative Equity Depending on the terms of the modification, a homeowner could end up with a loan amount that exceeds the current value of the home, resulting in negative equity. This makes it difficult to sell the home or refinance in the future.
Loan reinstatement is the process of paying back all missed mortgage payments, including late fees and penalties, in a single lump sum. Once these past-due amounts are paid, the loan is “reinstated” to its original terms, and the foreclosure process is stopped.
Pros:
- Immediate Stop to the Foreclosure Process One of the biggest advantages of loan reinstatement is that it immediately halts the foreclosure process.
- No Changes to Loan Terms
- Avoid Long-Term Credit Damage
Cons:
- Requires a Lump Sum Payment The most significant downside to loan reinstatement is the requirement to pay all past-due amounts, plus any penalties and fees, in one large payment.
- Does Not Address Long-Term Financial Problems While loan reinstatement can solve the immediate problem of foreclosure, it doesn’t address the underlying financial issues that caused the missed payments in the first place.
- Fees and Penalties Can Add Up When reinstating a loan, homeowners must pay not only the missed mortgage payments but also late fees, penalties, and any legal costs incurred by the lender during the foreclosure process. These additional costs can significantly increase the total amount owed, making loan reinstatement an even more expensive option.
- Limited Time to Reinstatement Florida law allows homeowners to reinstate their loan at any time before the final foreclosure judgment is issued. However, the longer you wait, the more fees and penalties accumulate.
Refinancing means replacing your current mortgage with a new one that typically has better terms, such as a lower interest rate or a longer loan term.
Pros:
- Consolidate Debt
- Avoid Foreclosure
Cons:
- Difficulty in Qualifying for Refinancing Homeowners in pre-foreclosure are already struggling with missed mortgage payments, which often means they have a lower credit score and strained finances. Unfortunately, this makes it much more difficult to qualify for a refinance. If you’ve missed payments and your credit has taken a hit, refinancing might be out of reach or come with unfavorable terms.
- High Closing Costs and Fees Refinancing comes with its own set of costs, including closing fees, appraisal fees, title insurance, and more. These fees can add up to 2% to 5% of your loan amount, which means that if you’re refinancing a $200,000 loan, you could end up paying $10,000 in closing costs alone. These upfront costs can be a huge burden.
- Higher Interest Rates If your credit score has dropped due to missed payments, you may not qualify for the best rates available. Instead, you could be offered a loan with a higher interest rate than your current one. This would result in higher monthly payments, increasing your financial stress rather than alleviating it.
- Down Payment required FHA and Conventional loans require 3.5%-20% downpayment.
A short sale occurs when a homeowner sells their property for less than the amount they owe on their mortgage.
Pros:
- Less Credit Damage Than Foreclosure Although a short sale will affect your credit score, it is typically less damaging than a foreclosure. Foreclosure stays on your credit report for up to seven years and can lower your score significantly. A short sale, will still cause a dip, but it signals to future creditors that you took responsible action to resolve the situation.
Cons:
- Damage to Your Credit Score Although a short sale is less harmful than a foreclosure, it still affects your credit score. The impact will depend on how the lender reports the sale to credit agencies. Some report the debt as “paid in full for less than the full balance,” which will still have a negative impact, making it harder to qualify for credit or future loans.
- No Profit from the Sale In a short sale, the homeowner doesn’t receive any proceeds from the sale of the home.
- Lender Approval is Required Even if you find a buyer and negotiate a sale price, the lender must approve the short sale before it can proceed. This process can take time, as the lender evaluates whether accepting a reduced payoff is in their best interest. In some cases, the lender may reject the short sale.
- Tax Consequences Although some lenders forgive the remaining mortgage balance after a short sale, the IRS may consider the forgiven debt as taxable income. This means you could be hit with a hefty tax bill after the sale. However, there are certain exemptions, such as the Mortgage Forgiveness Debt Relief Act, which may apply depending on the circumstances.
- Lengthy Process A short sale can be a long and drawn-out process, sometimes taking months to complete. Negotiating with the lender and finding a qualified buyer are just the first steps; even after you receive an offer, waiting for lender approval can delay the sale. For homeowners who need a fast resolution, this waiting period can be stressful.
- Potential for Deficiency Judgment In some cases, the lender may pursue a deficiency judgment after the short sale to recover the remaining loan balance that wasn’t paid off. This means that even after the home is sold, you could still be liable for the difference, further complicating your financial situation. In Florida, lenders have five years to pursue a deficiency judgment after a short sale, so it’s important to negotiate this aspect during the short sale process.
Our Experienced team can help stop the foreclosure process.
Creative Solutions can help with the documentation and process to keep the bank from taking the property and are unique to each situation.
Pros
- Money for relocation & a new start. Depending on the circumstances often this option, you will profit on the transfer of the home giving you and your family funds for a new start.
- Credit preservation. These options will prevent any more damage to your credit and often improve your scores unlike a Short Sale.
- Speed. Creative solutions can stop not only foreclosure process, can stop the Auction on your home.
- Flexibility. You often have more favorable terms than a bank approved short sale.
Cons
- Unconventional: Most homeowners do not know about creative solutions with out a consultation. Often not utilized.
- Right fit: depend highly on property, principle balance, foreclosure fees and condition of the home.
- Liens: Often homeowner is unaware of creditor or municipality liens that may change creative terms after a paid title search discovery.
- Work with Lender: Contact with lender for balance is required. You will often need to authorize a 3rd party do this work for you. Authorization forms usually require thee last four of your SS#
- Credibility: Unfortantely there are scams out there., Make sure your consulting company is a licensed Real Estate agent, Brokerage or well established company, with an entity registered with the state.
This legal option allows homeowners to voluntarily transfer ownership of their property to the lender, bypassing the formal foreclosure process.
Pros:
- Avoids the Lengthy Foreclosure Process
- May Provide Debt Forgiveness
- Less Public
Cons:
- Credit Impact: Less damaging than a full foreclosure, it still has a negative impact on your credit score.
- Tax Implications Forgiven mortgage debt can be considered taxable income. While the Mortgage Debt Relief Act of 2007 provided exemptions for some homeowners, this act has not been consistently extended.
- Future Homeownership Hurdles Opting for a deed in lieu of foreclosure could make it more difficult to qualify for a new mortgage in the future. While it may be less damaging than a foreclosure, many lenders will still view this as a significant financial misstep, and it could take several years to qualify for another mortgage.
A foreclosure auction is the final step in the foreclosure process.
This is the worse case scenario. Following the sale, the homeowner is evicted WITHOUT any possibility for funds to move and start new.
We have seen many homes with all of the homeowners belongs put to the curb after the foreclosure auction. The foreclosure will be recorded on your credit and home will be transferred to the lender’s name or a new owner.
The Foreclosure will remain on your credit report for 7 years.
