Does the Lender Really Want Your House?
First, pretend, put the shoe on the other foot, so to speak. Pretend that you were to loan your cousin’s kid money to buy a car, and the kid made payments on schedule for the first 7 months. Then he quit making payments for the next 4 months. He started “losing his phone,” and you couldn’t figure out why the car was looking bad whenever you caught him at his new minimum wage job. Okay,would you want the car, or money? – Right, you’d probably want to sit down with him and create some sort of new payoff plan that would help the kid get back on his feet, right? – If you have no interest in that car, you probably would rather help the kid get back on his feet with writing a new, easier payoff plan.
Does the lender really want your house?
If the bank has no interest in your house, then they would rather not have it back too. In other words, if there is not a lot of equity in your house, then the bank would rather not have it back. The best position you can be in if you are in pre-foreclosure is the position where you owe more than the property is worth. This is frequently referred to being “underwater,” or “upside down.”The Lender has dozens of options besides foreclosing on your home and then reselling it. Believe it or not, in most cases foreclosure is the lender’s least favorable option! However; it is the most widely known outcome, because the homeowner waits too long to react to the notice of default (lis pendens) and take comprehensive action. (Meaning that the homeowner needs to take all-inclusive action by getting all their paperwork in order and talk to the right people.)Why the lender really doesn’t want to foreclose:
- The lender is in business to lend, NOT to own property and be a landlord.
- Bank-owned real estate is expensive with higher property insurance rates than yours.
- The bank (lender) is dimerited by the federal government for owning too much real estate compared to money loaned out.
- The bank owned real estate has outside liabilities.
- Other Foreclosure Costs for the Bank include:
- Realtor Costs
- Holding Costs
- Closing Costs
- Additional Attorney Fees
- Costs for not loaning out that money
- Cleaning costs
- Repairs
- Discount to sell it anyway!
I am your advocate, the homeowner’s advocate, and all I’ve done here is talk about the poor lender. The reason for this is to help you have power. You must know your opponent.
You have options, and as I said, the lender has options too. Yours and theirs go hand in hand. How it shakes out, depends on the variables of your situation.
Until next time, please consider what housing payment could you afford?
If your foreclosure sale date is less than 30 days away, please call right away, we can personally speak. The more time you have the better.