Homeowners do not decide to become financially distressed, but many choose to go into foreclosure for lack of a better alternative. Weeks turn into months of back payments and without action from a homeowner, the bank will take steps to put a foreclosure notice on the property. Do not be caught unaware. People should avoid foreclosure in Miami FL at all costs, but many choose this action because they do not understand the true implication that a foreclosure can hold on your financial future.
What is Foreclosure?
The process normally starts with a simple Notice of Default. After you have missed a certain number of payments the lender will file a public Notice of Default which states that if the payments are not caught up they will begin the foreclosure process. During the first couple of months that you miss payments the lender will normally try to contact you either via phone or a letter. After these efforts have failed, you will start to see the Notice of Defaults, and after the notice has expired they will start the foreclosure process. Most lenders will also add in the associated legal cost for the foreclosure process so if you do not take action right away you will be liable for even more money then before. The exact time period will vary from state to state and even case by case.
Reasons Foreclosures are Bad
1. They sometimes cause bankruptcy – Even after you move out of your house the consequences of foreclosure do not stop. The bank has the legal right to come after any debt that is owed, including legal cost or if the house is sold at a loss. For example if you owed $250,000 for the house and the bank was only able to sell it for $150,000, you would still owe the bank the other $100,000. This money can follow you around for many years, and sometimes decades, and can sometimes even end up in your wages being garnished. After this happens many homeowners will file bankruptcy because of the financial problems that they suffer as a result of the foreclosure.
2. Credit rating goes down – You can see a drop in credit score from 50-200 points after a foreclosure depending on the exact situation. It will also remain on your credit score so even after the score has gone back up it will still cause red flags to go up and thus making it harder to make major purchases.
3. Potential job trouble – A lot of employers have started to do credit checks in addition to criminal checks when they do the background check. Especially in the current job market you do not want any extra reason for a potential employer to pass you by.
Start acting today on how to avoid foreclosure in Miami FL. You have to have the right mindset to make things much easier for yourself. Although it is a little uncommon, you can actually sell your house to make money out of it and eventually stop foreclosure. Talk to your lender and get the approval you need. After that, make sure to give us a call so we can help you get the cash you need. Contact us now.