Has the bank threatened to foreclose on your house in Los Angeles, CA? No matter who you are or where you are from, it’s possible for anyone to find themselves dealing with foreclosure. We all make plans for life, hope for the best, and do our best, but sometimes situations occur and extend far beyond what we can financially deal with. Unfortunate situations can occur, forcing us to deal with the unexpected.
If you are at risk of losing your home in Los Angeles due to a home foreclosure threat from your bank or home lender, the situation can seem overwhelming and hopeless. The good news is that there are a few things you actually can do. There are several steps you can take to protect yourself and potentially avoid home foreclosure in CA. When done in a timely fashion in order to not miss key deadlines, the steps can be successful.
In this blog, we’ll go over five things you can do if the bank has threatened foreclosure, so you can avoid losing the home (and the hard earned equity in it). Of course, it is always best to consult with your lawyer when dealing with these sorts of difficult situations.
What Is Home Foreclosure?
A home foreclosure occurs when banks and lenders try to recoup their losses after a homeowner stops paying their loan. When someone is no longer paying, the bank will take possession and sell the home as to avoid a loss. If you think the bank may foreclose on your house due to a default of payment, it’s important to take action right away. Don’t avoid calls from the bank. Avoiding contact with your bank or lender is the worst action to take. Instead, take action to help find a solution for your current real estate situation.
1. Contact Your Lender, Immediately
The first thing you should do if you receive a foreclosure notice is to contact your lender. It’s essential to communicate with your lender as soon as possible to explain your situation and discuss your options. Your lender may be willing to work with you to modify your mortgage payments or create a repayment plan that is more manageable for you. This could include a loan modification, forbearance, or a repayment plan.
It’s important to remember that your lender wants to help you avoid foreclosure since it is an expensive and time-consuming process for them as well. Borrowers who are behind on their mortgage and don’t respond promptly to letters and return phone calls actually put themselves in worse position. By being highly responsive, your are showing good faith, so it is more likely your lender will be understanding and provide flexibility to you, so you can keep your house.
2. Seek Assistance from Housing Counselors
Don’t be afraid to ask for help if the thought of talking to your lender feels intimidating. If you’re struggling to communicate with your lender, unsure of your options, or confused on what to actually tell your lender, strongly consider seeking assistance from a housing counselor. Housing counselors are professionals who can help you understand your rights and options; and most importantly, negotiate with your lender on your behalf. Housing counselors can also help you create a budget and develop a plan to get back on track with your mortgage payments, so you can end the stressful experience of home foreclosure in Los Angeles.
To re-emphasize the recommendation in #1 above, initiate communication and be responsive to your lender. Whether you are responding to a lender directly about your risk of home foreclosure or secure a housing counselor to do so on your behalf, either option is a good one as long as recurring communication with your lender is happening.
3. Consider Refinancing Your Mortgage
If you have been paying down your mortgage for a long time and the value of your home is higher than when you purchased it, you might have some equity to help you out in this situation. If you have enough equity in your home, you may be able to refinance your mortgage to a lower interest rate or longer term payment schedule. This could make your monthly payments more affordable and potentially help you avoid foreclosure.
However, it’s still possible that refinancing is may not always be an option, especially if you have missed payments or have a low credit score. It’s essential to speak with a financial advisor or mortgage broker to determine if refinancing is a viable option for you.
4. Sell Your Home Off-Market (Fast)
If you’re unable to make your mortgage payments and don’t see an immediate fix for your financial distress, you’ll probably face foreclosure in Los Angeles. So selling your home fast to a local investor (ie. cash buyer) may be your best option.
Selling your Los Angeles home with a fast closing can help you avoid foreclosure and potentially allow you to recoup some of your equity. However, it’s important to note that selling your home by listing it on the MLS with a Los Angeles real estate agent can take time (three to six months or longer). Selling your home on the MLS might take longer because you may need to make repairs or updates to your home (with your own money)to make it more attractive to potential buyers, who are also looking at other homes nearby. For this untimely and costly hurdle, a traditional listing is not the right choice in these situations.
However, a direct sale to Fair Sale Homes will allow you to sell your home fast and walk away before the foreclosure process even begins. The process is simple, non-evasive, and fair. We are transparent and always seek to educate our homeowners, so they can make the best decision. We’ll work with you to determine the option that is in your best interest and will never pressure you into a sale that isn’t right for you.
5. File for Bankruptcy
Filing for bankruptcy is a last resort option that should only be considered if all other options (explained above) have been exhausted. Bankruptcy can help you avoid foreclosure in Los Angeles by putting an automatic stay on all collection activities, including foreclosure proceedings. Sometimes, filing for bankruptcy will only put a temporary delay on the process of home foreclosure, providing you a bit more time to figure out how to come up with the missed payments.
If you do ultimately end filing for bankruptcy, know that bankruptcy can also have long-term consequences on your credit score and financial well-being. It’s essential to speak with a bankruptcy attorney to determine if filing for bankruptcy is the best option for you.
Fair Sale Homes Can Help You in Los Angeles, CA
Facing a home foreclosure threat can be a daunting and stressful situation, especially in an expensive location like Los Angeles. However, it’s essential to remember that there are several options available to you to help you avoid foreclosure in the State of CA. It’s critical to communicate with your lender early and often, seek assistance from housing counselors immediately; and consider refinancing your mortgage, selling your home fast to save your equity, or file for bankruptcy as a last resort. By taking action and seeking help, you can protect your home and avoid the devastating consequences of home foreclosure in Los Angeles. If the bank has threatened to foreclose on your house in Los Angeles, Fair Sale Homes is here to help! Reach out to us today at (626) 863-7006 to learn more about what we can do to help you with your property.
WE BUY HOMES across cities Southern California. A sample of cities where we buy homes for cash: East Los Angeles, Lincoln Heights, Silver Lake, Atwater Village, Van Nuys, Northridge, Pacoima, Panorama City, Harbor City, and Wilmington. Also, we buy apartments in Los Angeles, CA. Whether you are experiencing home foreclosure, code violation, failed property sale, or simply have an unwanted property, we will work with you to find a solution.