What is a foreclosure bailout?
Question:
Answer:
A foreclosure bailout is a loan that is given to a homeowner in foreclosure so that the foreclosure process is stopped.
This can be done with a refinance, where the defaulted loan is paid off by a new mortgage company, who then has the loan on the property. Because the new loan is used to pay off the foreclosed loan, it is described as a "bailout" loan.
A second mortgage can accomplish this, as well, by giving the homeowners a loan that will make the first mortgage current again, paying back all the defaulted payments, plus costs, interest, etc.
Foreclosure bailout loans are not that easy to qualify for, though. Many lenders will only go up to 70-75% of the value of the property as a maximum loan amount. Also, rates for these types of mortgages can range up to 14%, which requires the homeowners to have a good amount of income to be able to afford the payments.
Foreclosure bailouts are offered by a small number of traditional lenders and a number of hard money lenders. Credit is not used as a qualification, since people who have not made a mortgage payment in several months can not be expected to have great credit.
Hope that helps.
ForeclosureFish
http://www.foreclosurefish.com/...
A foreclosure bailout is a refinance on your existing mortgage that caused you to get into foreclosure proceedings. It basically saves you from going into complete foreclosure, and allows you to save your home.
Basically a bank, lender, or investor buys your home from you, then leases it to you for a 12-month period, at which point they sell it back to you. During the 12 months you make payments, get out of foreclosure, and become current on your mortgage.
Learn more at http://www.thetruthaboutmortgage.com...
More Related Questions & Answers...