The COVID-19 pandemic has caused tremendous damage to the economy and housing market. Many states have offered mortgage relief programs but that is shortly coming to an end, with many Americans’ hours being cut or completely out of work families are finding it hard to make ends meet.
Families who rent are facing similar problems with evictions pilling across the United States. The government has ordered a halt on temporary evictions but some landlords are finding loopholes to evict tenants.
Foreclosure During the Coronavirus Pandemic
With mortgage relief programs ending, homeowners facing foreclosure during the COVID-19 pandemic have a number of different outcomes to consider. This guide provides a rough idea of what to expect and outlines options for paying off the foreclosure note, selling the property, or declaring bankruptcy. Protect your home and financial well-being by understanding your options in the current housing market.
Paying Off The Foreclosure Note
In the best-case scenario, the homeowner can pay off the foreclosure note ahead of time. This is the ideal solution for both parties as it allows the homeowner to keep the house while also satisfying the lender in regards to whether they think the mortgage will likely be paid properly.
Be wary of paying off this debt through options such as loans or other lending services. Homeowners may wind up with a loan that is even more difficult to pay as a result of the measures they take to pay off the foreclosure note.
Selling Property During the COVID-19 Pandemic
If it simply isn’t feasible that you to pay off the debt, the possibility to sell the home generally remains. This can be done through the seller or by the financial institution, should they take possession of the property.
This is a tricky option as we have a lot to consider before trying to sell it yourself. If the homeowner still owes more for the mortgage than they have paid then they are still liable for that debt unless they will convince the mortgage lender to give them a lower payment.
Furthermore, if the sale of the home doesn’t satisfy the debt for most other reasons the bank will probably continue chasing the former homeowner for money, with the remaining debt continuing to gain interest many times.
In the case of auctioning the home, the bank will take control of the property and will look to sell it to the highest bidder. They will then get every deed and everything else concerning the home. In some cases, it may be possible to allow somebody to buy the property and rent it from their office, but this usually relies on personal negotiation and the opportunity to prove that you could pay the rent, according to the Local Records Office in Bellflower, California.
Businesses Are Closing and Declaring Bankruptcy
Bankruptcy is the most annoying option on the list but it is usually used when the foreclosure and eviction process continues to be started. By declaring bankruptcy you’ll be able to stall an eviction by a few weeks, which may give you enough time to save up enough money to pay off the debt and keep the home.
Homeowners facing foreclosure during the COVID-19 pandemic may consider declaring bankruptcy as a last resort. However, it is important to keep in mind that this option can have devastating effects on credit and personal life. With mortgage relief programs ending, it may be wiser to consider selling the home instead. This guide provides a rough idea of what to expect and outlines different paths to prevent foreclosure, protecting your home and financial well-being in the current housing market.