by Lori Mode
Foreclosure – the many reasons to avoid it
October 25, 2009 in Everything About Foreclosures, Home Economics by Lori Mode
If you are a homeowner facing financial difficulty, you will hear all sorts of things about why or why not you should let your home go back to the bank. Some are true and some are not…some depend on your circumtances…while some are just crazy.
Yesterday, I actually talked to a couple that was told by an attorney to stop making their mortgage payments and he would try to do a loan modification for them but if that didn’t work they were better off letting the bank foreclose on the home than selling them home on a short sale. I was appalled that he has been charging them money for this advice. They now have 30, 60, 90, and 120 day lates on their credit and the attorney cannot get the bank to talk to him about a loan modification, so they are just walking away from the house and letting the bank have it through a foreclosure.
Before making any decision to let the bank foreclose on the house, consider these reasons to avoid foreclosure -
1. A foreclosure is the one credit report item that is almost impossible to have “repaired” on your credit.
2. Your credit scores will be lowered by hundreds of points, possibly over 300 points.
3. A foreclosure is the most devastating credit issue you can have.
4. Current employers are starting to run credit checks on their employees. This could put your current employment position in jeopardy. Most employers are now running credit checks on prospective employees – this could really hurt your potential for a new job.
5. A life time hit on every mortgage application you fill out…you will always have to disclose the foreclosure on future loan applications. This can have an adverse affect on future mortgage rates.
6. Government employees, as well as military and law enforcement positions can be jeopardized by a foreclosure.
7. Emotional impact and broken families due to the stress of a foreclosure.
I know that when you are facing financial difficulty, it is very hard to believe that your current financial difficulties will pass, but if you avoid foreclosure, things will get better faster. You will feel better knowing that you did everything you could do.
For more information on Short Sales
If you are a seller and wish to contact us for a FREE consultation regarding a possible short sale on your home, please call us at (916) 230-0371 or send email to Lori@ModeandDurhaM.com.
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Lori Mode and Bruce Durham, Keller Williams Realty in Elk Grove, CA
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