Foreclosure Can Be Just the Start of Something MuchWorse,

Or, Confronting the F-B-I

Stands for foreclosure itself. It means the loss of your home, equity, credit and dignity. It is a very public process, with your name listed in the public court records and then published in your local newspaper. Then your predicament is displayed on your credit report for at least 10 years.

Depending on the State you live in, it could take a couple of months to more than a year to get you out of your home.

A foreclosure probably means that you will not be able to purchase another house in the next few years unless you agree to the exorbitant interest rates of "Bad Credit" mortgages which can be twice the rate of regular mortgages and possibly even higher.

Finally, contrary to what many opportunistic lawyers and/or "Foreclosure Consultants" may tell you, filing bankruptcy will probably not solve your problem, it may only add a bankruptcy to your credit report, if you are not careful. We can advise you if and when bankruptcy should be a part of the strategy to save your home.

Know your options - get your absolutely free 39-page report NOW!

Bankruptcy can be used to prevent a deficiency judgment and an IRS lien if your property does not sell at auction for more than the mortgage amount. Bankruptcy too, can be used tactically to delay the sale of your property and should be used as a last resort to stay the sale. You will have from 30 to 60 days before the sale is held.

A Chapter 7 bankruptcy, total liquidation of your assets will not save your home, which is a secured debt. It only eliminates unsecured debt such as credit cards and installment loans.

Chapter 13, the so called wage earner plan is often touted to be the answer to foreclosure. However, it is often illussary. The reason is that all of the mortgage arrears must be paid off over a 3-5 year period, in addition to keeping up with current mortgage payments. This usually means that your monthly payments in total will be hundreds of dollars per month more than the regular payments you could not afford before!

However, Chapter 13 may be for you if your situation has improved to the point where you are sure that you can carry higher than before debt payments faithfully for the next 3-5 years.

One late payment and you will have a bankruptcy AND a foreclosure on your credit record!

That is why less than 1 in 3 of those who start a Chapter 13 are successful in completing it and saving their home.

Property generally does not sell for anywhere near its true market value at any forced sale such as at foreclosure sales, that is why they are so popular with investors.

The resulting shortfall is a"deficiency", the difference between the amount of the mortgage and what the property actually sells for. In most States, the bank then gets a judgment against you for the amount of the deficiency. With this court order, they can go after whatever you own: the cash in your bank account, your car, your salary, your new home etc.

If the bank ends up not being able to collect on the judgment, they will send a Form 1099 to the IRS for the amount of the money they were not able to collect from you.

You see, the IRS has this curious notion that any debt you were obligated to pay that was "forgiven" ie written off, is income to you. They expect you to pay the tax on the deficiency, in cash on your next tax return.

The IRS, of course, can take any thing you own. Your only out may be to make mortgage sized payments to the IRS for the next couple of years to pay off the taxes.

Unless you were smart enough (or read this article in time), to file for bankruptcy Before the bank sent you a Notice of Default, which you probably would never have thought of doing in the emotional turmoil typical of those situations; you could not avoid the IRS tax bill.

So you can

see that you must avoid foreclosure at all costs.

Let's take a look at some possible "solutions" to foreclosure that are all too common:

What if I just send the keys to the property back to the bank?

Sending the keys back to the bank or walking away from the property will not solve the problem.

"Send the Keys Back to the Bank!"

Once the bank takes the property and adds all kinds of holding costs, refurbishing costs, legal charges, selling costs and commissions, the amount you owe will be higher than ever and the likelihood of a deficiency that much greater.

Short Sale or Offer-in-Compromise

This is where the bank seems to be forgiving, accepting a lower amount of money in settlement of their loan. Unless you get it in writing that they won't, they then send the Form 1099 to the IRS and you still end up owing taxes on the amount of money you did not pay!

Scams

There are many variations of "Give Me the Deed" in which you are talked into giving the deed to your house to a fast talking "Foreclosure Consultant."

He (or she) may say, "Give Me the Deed" and then the bank won't be able to foreclose on you because you don't own the house anymore! Wrong, the note and mortgage were signed by you and you defaulted.

They may say, "Give Me the Deed" I need it in order to negotiate with the bank to stop the foreclosure. That is not true, and you have just given away your house! But you haven't stopped the foreclosure.

They can also pay you a small sum for the deed with more to come when you move out. Of course, your chance of collecting any more money is slim to none.

The Answer

The answer depends on your needs and resources. If you have suffered a temporary setback from which you have now largely recovered but the bank is demanding payment of the arrears in full, we will loan you money to Help you reinstate your mortgage, if you have the ability to make the on-going mortgage payments. I say Help you because we do require you to put up some of the money too.

This way, you demonstrate your fiscal responsibility to us. Rates and terms are decided on an individual basis.

If, on the other hand, you really cannot afford to keep your house or you no longer want to stay in your house, we have a different answer.

We will buy it from you, going to contract in as little as 24 hours, with No mortgage contingency. We will pay all cash, 70 or 100% of your house's market value as determined by appraisal, you decide.

If your mortgage is equal to or greater than the market value of the property, we will purchase the property for the balance of the mortgage, within reason.

If you would like to see if your property qualifies for one of our programs, please complete the Offer Form.

Bankruptcy

If it turns out that your only choice is to file bankruptcy, either to stall for more time, postpone a forelosure sale, prevent a deficiency and IRS lien, or you feel that a Chapter 13 may be your only way out, we can help you with that too.

Before deciding on any ultimate solution, know your options. Leave your contact info HERE , get your absolutely FREE 39-page report, and I'll be in touch with you to discuss the very best solution FOR YOU, whether you want to keep your house or sell it quickly.

Dreaming Bear Home Solutions LLC