FAQ's For Homeowners
How Can I Sell My House With No Equity?
What is a pre-foreclosure sale?
A pre-foreclosure sale (commonly referred to as a “Short Sale”) allows you to avoid foreclosure by selling the house even if you owe too much on it. You are still the seller but the bank and lien-holders must approve a reduced debt payoff. We negotiate a reduction in your debt.
What will this cost me?
Zero. The bank is taking a reduction in their payoff so commissions and closing costs can be paid without any money from you. Essentially, the bank and the buyer are paying for your closing costs, attorney fees and realtor commissions.
Why do you need our Pre-foreclosure Sale Program?
You need this if you want to avoid both a foreclosure and deficiency judgments that will seriously affect your ability to qualify for credit in the future. We can help you even if you have a loan balance when compared to the value of the house. Traditionally, if you owe more than the house is worth, closing costs and commissions would have to come out of your pocket. Most homeowners try to list the house above market value and hope for the best. Usually, if you are behind on payments you won’t have the funds available to close. A pre-foreclosure sale done correctly will cost you nothing. Attorney costs, commissions and forgiven debt are taken from the bank’s discount.
How will you benefit?
You can avoid foreclosure, minimize the damage to your credit, walk away without a deficiency judgment, and possibly get paid for participating in the program! To help save your credit and stop a foreclosure you need to act early. You can concurrently process a refinance, forbearance, loan modification and a short sale. The short sale process can take a while so you may as well start early. If another plan unfolds, it didn’t cost anything to think defensively. If you let this go to a foreclosure auction, the bank can process a deficiency judgment for money they lost in the foreclosure. In a properly negotiated pre-foreclosure sale, the bank gives up their right to collect for damages.
How will the bank benefit?
They know the house is headed for foreclosure. Nationally, this costs them an average of $50,000 in lost interest, attorney fees, taxes, insurance, repairs, marketing commissions and eviction costs per house. If they can dispose of the property before a foreclosure with a controlled loss in a few months it saves them money in the long run. Many banks know they made bad loans with inflated appraisals. They are willing to make up for it now. They need to feel some pain before allowing a loss which is why the payments must be delinquent.
What is the procedure from here?
Call me to make sure the house fits the criteria for a pre-foreclosure sale. You will sign an Authorization to Release Informationto allow my staff to negotiate with the lender or other lien holders. We will need the following from you:
My team will submit the package with purchase contract, HUD-1 and a letter explaining the situation. The bank will send their specific paperwork requirements and schedule an appraisal. I will accompany the appraiser. This is the most critical event and must not be taken lightly. This is why I must be involved directly. If it comes in too high, the house will go to foreclosure. You want the appraisal to be as low as possible by taking repairs into account!
What is the benefit of using our company?
We work hard to create a solution that benefits everyone. You avoid foreclosure, the bank loses less money than at auction, and we buy a house for our buyer. We can even help your realtor get commissions if the house is listed now. Our specialty is bank negotiations. Pre-foreclosure sales are time intensive and require special knowledge and systems.
Are you an accredited debt counselor?
We are not debt counselors. Our job is to process the short sale and negotiate a debt settlement once you have determined the need to sell. Please contact Home Headquarters for an in-depth personalized debt review.