Big Foreclosure Problem?
Question:
Right now I'm only 1 month behind on the 3 bad ones but I will be catching up on those loans this month. The problem is I know I can't keep it up.
I will be able to sell 2 of the 3 bad ones at break even, but it will be hard. Unfortunately, I think I'll fall behind on those before I can sell. Then my worse property I owe so much more on it than I could ever sell it for. What can I do?
My fears are:
Being foreclosed on one of these will not only destroy my credit but allow the creditor to come against my other properties. That is true, isn't it?
What can I do to save myself? I really need help bad. I also have lots of credit card debt that I'm starting to have trouble with. I also owe family some money too. I feel in over my head.
Answer:
Your best hope is to contact the holders of the respective notes about the possibility of a short sale. This is where the lien holder will basically take a settlement on the payoff. Sometimes they are willing to do it to minimize the money and hassle they have to go through in a foreclosure. Basically if it goes to foreclosure the homes would be sold at auction for far less than they are worth leaving a judgement on you for the balance that the banks know they will have great difficulty collecting. It is sometimes worth the small hit of a short sale to them verses the huge hit they would take in foreclosure. Good luck!
Contact HUD and find out your rights, even as an investors the government has made foreclosure laws more strict. You need to sit down and be honest with yourself about your situation. Are any of the three houses in a market where you can sell or rent? Foreclosure is something a ton of investor and a lot of families are facing. But it sounds like you have your eyes open. There are resources out there to help you. Start with HUD and keep looking. Good luck!
Not to be mean, but you are really over your head.
The best thing you can do it to contact your lender(s). Explain your situation, that you are trying to sell the property. They may be willing to restructure your payments until you can get a handle on things. But they need to know NOW, not 3 or 4 months from now when you're way behind. They don't want to got through an expensive collections/foreclosure process any more than you do. Co-operate with them, and they should be willing co-operate with you. BTW - I worked in a foreclosure department.
Sounds like you over extended your self. Classic case of too much too soon. In California a foreclosure takes about a year the problem is I am not familiar with where your other homes are located. Anyway in California a foreclosure of a home owned by an individual is confined to that home. Meaning whatever the lender gets out of the auction is all they get. For you 3 properties that are failing either turn them around or dump them for as much as you can.
Maybe you can re-finance them by using the others as collateral, if you want to go that route
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