Monday, July 20, 2009
If keeping your home is not an option, you may want to consider these alternatives:
- Sale: Your lender will generally give you a specific amount of time to find a buyer and pay off the amount you owe on your mortgage. Your lender may need you to use a real estate professional to help you sell the property.
- Pre-foreclosure sale or short sale: If you can't sell the property house for the full amount of the loan, your lender may accept the amount you get for the selling price, still if it is less than the amount you owe. You may owe income taxes on the difference between the amount you owe and the amount you are able to pay back. Check with the Internal Revenue Service for tax information.
- Assumption: A good qualified buyer may be allowed to assume (take over) your mortgage. Ask your lender whether this choice is available to you.
- Deed-in-lieu of foreclosure: You may be able to "give back" your property to the lender, who then forgives the balance of your loan. Again, there may be income tax consequences, so check with the IRS. This option will not save your home, but it is less damaging to your credit rating. Some lenders compel certain restrictions on taking back property. For example, they may need that you try to sell your home at a fair market cost for at least 90 days.
posted by nisha
@ 1:43 AM
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