In real estate, and especially for homeowners, there’s another “F” word that’s offensive. That word is “FORECLOSURE.” With the current state of the economy and with so many people struggling, some are falling behind on their mortgage payments. Anywhere from medical emergencies to the loss of one’s job might put a homeowner behind on their payments. If you’re considering selling your home to get out from under this kind of situation, you might be asking yourself, “Can I sell my house if I am behind on payments?” Odds are, the answer is yes. That is, as long as that dreaded F word hasn’t reared its ugly head.
I’m Behind On Payments. Can I Sell My House?
The first determination is to see if you are currently “underwater.” All this means is as long as the value of your house is not below what you currently owe on the mortgage plus the amount you are behind on payments, you are not yet there. And that’s good news. If this is where you stand, there’s no reason why can’t sell your house like you normally would. You can contact a real estate agent and get the ball rolling. You can also list the house yourself as a for sale by owner property. Either way, if you need to sell your house because you can no longer afford the payments, it is critical that the house is sold before you head to foreclosure.
What Is Foreclosure?
Investopedia states that “Foreclosure is the legal process by which a lender seizes and sells a home or property after a borrower is unable to meet their repayment obligation.” In other words, if you do not make your mortgage payments or fall too far behind on these payments, the bank can take ownership of your house. Fear not, though, since most federal laws state that the bank can not begin the foreclosure process until you’ve been late with your payment for 120 days. And depending on where you are on this timeline, you might need to list your house for sale…yesterday.
To Avoid Losing It, I Need To Sell My House Fast!
Yes, you do. As you know, the typical length of time it takes for a sale to go through is 45 to 60 days or more. If you’ve been behind a couple of months already, you can certainly see the urgency in getting your house on the market. Being behind on payments is not the end of the world, though, and if you can scrape together one more payment, you can extend the time you have to get that house sold.
The best advice in this entire piece is this: TAKE ACTION NOW. You do not want to lose the equity built up from all your previous payments since you will need that money to survive. Get in touch with an agent or a company that buys houses for cash in your area and make sure they understand your situation. Most professionals will sympathize and want to help you. You need to get that ball rolling, even if you’re rolling that ball uphill.
Last Resorts If You Are Behind On Payments
With the market slowing down, you might have trouble getting the house sold, regardless you’re behind on your mortgage payments or not. There are a couple of moves you can make if you are struggling to sell your home.
The Short Sale – If you’re underwater and your asking price will be lower than what you owe, including your balance and delinquent payments, you might have to settle for a short sale. The struggle with this is you have to get your bank to write off the difference. of course, banks do not like to lose money, and they will with a short sale, but it might be preferable for them to take a small loss versus going through the foreclosure process.
The Forbearance – A forbearance is a brief reprieve from paying your mortgage payments for one to 3 months. If you simply just need to “catch up” due to a layoff or for some similar reason, you can try to work out a deal with your bank.
Cash Home Buyers – Are local investors who can buy your house for cash and can usually close a lot faster than a traditional buyer. Companies like Need To Sell My House in Denver can buy your home quickly even if you are behind on your house payments. In the end you get to sell your house and avoid the bank foreclosing just because you can no longer afford to make your payments.
Being Behind On Your Mortgage Payments Is Not The End Of The World
Understand that it’s not the optimal situation, but it’s also not the worst. You still own property, you still have a product with value, and you still have hope. Work hard to get caught up, get your house sold, or get a deal with your bank so you can come out the other side of it all unscathed. Now that you know the answer to, “Can I sell my house if I am behind on payments?” it’s time to get moving.