How to Weather a Real Estate Foreclosure

Today's real estate foreclosure rate is skyrocketing. There are a lot of ways to fix your real estate problems, and a lot of experts who can help along the way. But, what about the other part of foreclosure you have to deal with? What about the fear, the stress, and the pressures on your job, your family, and your friends. Don't make hasty decisions based on guilt and fear, that are likely to make you do well-meant, but ill-advised things!

Instructions

Difficulty: Easy

1. Find out what your options are before there is a problem! Start fixing the problem before you are actually late on any payments! Many options exist, but if you're behind on the payments, the early options go away. Look at the property as a "thing," and not as your "home." You can save thousands of dollars in legal fees and countless hours of stress and panic, all by knowing what your choices are before you need them! Many real estate offices, banks, and schools are offering free or low-cost foreclosure classes that outline your choices and what your expectations should be.
2. Analyze whether you need 'expert' advice and assistance, or not. If you don't have the knowledge, desire, or time to solve your dilemma, go get some experts on your team! Even if you decide to take it on alone, there may be times when handing over parts of the process to others who are less emotionally involved, or more knowledgeable, will be a good choice!
3. Make sure you are eating well and sleeping! You'll need your stamina and health to weather the stress and the extra work you'll be taking on for the next 3 or 4 months.
   Take care of yourself and your family! Plan an evening or a weekend before you start, to address fears and frustrations! This is also a good time to set expectations and establish roles for everyone to help with during the process. Don't isolate your family from your situation. Kids need to know how to handle troubles when they grow up, and they'll definitely figure out that there is something wrong. You don't need to go into details with your children, but you can tell them that you have some problems to work on that are really important, and you'll really need their help in some important ways until you've solved it. Be sure you let them know how long this extra time will be needed, and be sure to let them know when it is fixed! Once the problems are fixed, you can share more of the story.
4. Take care of your job! Even when you hire assistance, you can expect to spend about 15% of your time on paperwork, reviews, and other process requirements for the next three months. Plan for the time constraints accordingly. Try to make advance arrangements on your job for time off to focus on the foreclosure redemption process! One half-day per week, during business hours, for two months, will initially do the trick. Two or three hours, every two weeks, for 2 months after that, should be just about all the time you'll need. Afternoons are better, so you don't have to return to work in a distracted state of mind. Don't try to fix this problem while you are working on the job or during your lunch break! Something along the way will definitely suffer from the lack of attention! Take the time to help save your home with all the focus time you'll need.
5. Talk with your mortgage company to find out if they will restructure the loan, or possibly refinance. If you can't make the call yourself, hire a consultant to make the calls and do the negotiations for you. Other options to find out about are equity loans, equity shares, pipe loans, and loan discounts.
6. If it looks like you'll have to sell your property, list the property for sale as soon as possible. Today's real estate market is slow, and it may take some time to sell your property. Think more about where you are going, and less about what you may be leaving behind.
7. If property values are dropping, and you don't think you'll be able to sell for what you still owe on the loan, you may want to consider a short sale. A short sale requires several steps, and there are many experts out there that can help. Basically, you will need to negotiate a new property value based on the current loan, minus any monies that you'll need to fix, market, and sell the property. You then sell the house to someone (like an investor), at the new price. You will want to get some tax assistance with this as well. You'll need to get a realtor involved in determining the value of your home – and that will include ordering an appraisal. Appraisals generally cost between $300 and $500. Obviously, research is involved, but it really isn't that difficult today to find the information you need.
8. If the foreclosure cannot be avoided and you want to buy time, you may want to consider filing for bankruptcy. Filing bankruptcy can buy you between 2 and 3 months. You can file a bankruptcy up until the hour the foreclosure sale takes place, but you'll need several days to prepare. The laws have changed, and legal help is definitely recommended if you are looking at a bankruptcy. Again, don't get caught up in the emotions; just realize that sometimes bankruptcy can leave you a lot better off than where you are today. Always remember the goal is to move forward.
9. If you have to move, realize that you can be evicted from your home after your property is sold at auction. But you do not have to leave until an eviction process is complete! Evictions take anywhere from 3 days to 3 months. Check up on the process and avoid having the sheriff remove your belongings to the curb!

Tips & Warnings

• Don't try to deal with the physical, time and resource demands of real estate foreclosure at the expense of your family or your job. The inevitable process goes on with, or without, your consent. Your family and friends will likely be with you long after the process is dealt with, and hopefully, after any foreclosure that actually occurs. You need to work now to make sure their good opinions are still with you before, during, and potentially after, a foreclosure process.