There are many alternatives available to you rather than “Walking Away”

Despite what you may believe, here are options you should consider prior to deciding to “walk away.” :

• Refinance could be an option
• Lender workout solution
• Sell and bring in cash to closing
• Short Sale
• Deed in Lieu of foreclosure
• Foreclosure
• Do nothing or walk away

Refinance Options

Homeowners who are current with their mortgage payments may be able to take advantage of today’s mortgage rates and retain ownership of their home via refinancing to a 30 or even 15 year fixed rate loan through the Home Affordable Refinancing Act.

Some basic requirements: Owner occupied, 1-4 unit home, Owned or backed by Freddie Mac or Fannie Mae, Loan to value (LTV) ratios above 80% but not more than 125%, Must be current on existing mortgages, must have enough income to support the new mortgage payments

Additional information

Lender Workout Solutions

Lenders will often work with with a distressed homeowner to assist them with keeping their home. Workable solution may consist of reducing or rolling back interest rates, forgiving back payments, adding them to the loan amount, or possibly recasting the entire loan and wrapping all fees into a fixed rate mortgage.

Loan modification could be a suitable solution. Lenders may entertain a loan modification if borrower is able to meet the requirements and guidelines. HAMP Home Affordable Modification Program may be able to assist struggling homeowners to stay in their homes. HAMP has a strict guidelines and requirements to be eligible: Owner occupied, 1-4 unit dwelling, unpaid principal balance that is equal to or less than $729,750 for single unit properties. Higher limits available for multiple unit dwellings. Loan originated on or before Jan 1st 2009, payments exceed 31% of borrower’s gross monthly income, Experienced a change in income of other financial hardship, at risk of imminent default or in default.

Short Sale

A short sale may be the best option for most homeowners that find themselves in distress and facing foreclosure. The short sale provides a window of opportunity to sell the property in which may partially satisfy the amount owed to the lender in order to release the lien against the property. The short sale is much more preferable on a borrowers credit score than a foreclosure.

The Home Affordable Foreclosure Alternatives Program (HAFA) brought into effect November 2009 by the Obama Administration is designed to assist borrowers who meet the requirements and are eligible for the program, and are unable to keep their homes. Under this program borrowers an mortgage servicers are provided with incentives to help facilitate short sales or deed in lieu of foreclosure if the short sale is not successful.

Deed in Lieu of Foreclosure

A deed in lieu of foreclosure is when the borrower aggress to trade back the property to the lender in exchange for the cancellation of the note.

Foreclosure

If the foreclosure sale date is just weeks away from taking place. We advise you to contact your lender immediately and see if there is any way of exploring alternatives to foreclosure. You would nee to delay or postpone the trustee sale date to move forward with any other alternatives (short sale).

Walking Away

If you are simply unhappy with the current value of the property or it is less than what you paid or owe, you should contact an attorney for advise. Simply walking away from your property could cause you unforeseen and addition financial consequences.

Contact the Klinger Real Estate Group and get help now!