With millions of homes across the country going into foreclosure, exactly what is a pre-foreclosure in Worcester, MA? It’s important for both buyers and mortgage holders to understand the process. Each state is different so you want to make sure you are looking at state specific information for your situation.
So what is a pre-foreclosure in Worcester anyway?
Many homeowners across Massachusetts and Worcester are facing difficulties making their monthly mortgage payments. Bet it difficulties resulting from a job loss, covid related, too many repairs or any other reason to fall behind on payments. If a homeowner misses 3-6 months of mortgage payments, the lending institution will issue a warning, notifying the homeowner to pay or risk losing their home. This period is known as “pre-foreclosure.” However this timeframe can be as short as missing one payment. Every lending institution will have their own policy.
Banks and mortgage lenders typically provide up to three months for the homeowner to become current on their payments, although this can vary as stated. If the homeowner fails to make the necessary payments, the bank will eventually be forces to foreclose on the home, assume ownership, and evict the homeowner. However, during this stage of the foreclosure process, there are several options available to the mortgage holder to prevent the loss of their home.
Pre-foreclosure Options for Borrowers
If you’re behind on mortgage payments, you’re likely to receive a “notice of default” from your mortgage lender.
This document will state that you have not made mortgage payments for the last 90-180 days. It’s important not to panic.
Prevent Losing Your Home: Explore Your Options
- Refinance Your Mortgage: If you have equity in your house (meaning your mortgage is “above water”), consider refinancing your mortgage to lower your monthly payments. Contact a reputable mortgage broker in Worcester or contact us for a referral.
- Sell Your Home to a Real Estate Investor: If you need to quickly sell your home in Worcester, our reputable team at Turning Point Home Buyers can provide a cash offer. Use the cash to pay any back-payments owed or explore options with the lender for relief. We make the process stress-free and can often close in just a week or two if that is something that is needed. Learn more about selling your Worcester, Massachusetts home to us.
- Short Sale: Contact the bank and inquire about a short sale. In a short sale, you sell your home for less than its worth, and the bank takes the loss as a tax write-off. Be aware that you may still be responsible for paying the difference to the bank if the sale price doesn’t cover the loan amount. However, in most cases the bank will allow the short sale with allowing all debts to be wiped out. If not, the homeowner is less likely to go through with this option.
- Bankruptcy: Consider declaring bankruptcy to buy yourself some time to pay off your debt. However, be aware that bankruptcy will impact your credit report for several years and can have significant consequences.
Lenders are very much aware of the widespread financial troubles across the country and they’re willing to work with borrowers a lot of the time.
If you’re honest and communicate with your lender, you’ll often find that there are options that will allow you to remain in your home, or at least salvage your credit rating.
A foreclosure can often negatively affect your credit score by 200-400 points and can prevent you from obtaining a loan of any sort for 5-7 years, so be very dutiful if you’ve received a Notice of Default from your lender.
But if you’re not able to find a solution with your lender working directly with them… connect with us. We may be able to help.
How We Can Assist You If You’re Facing Pre-Foreclosure
- We Can Help with a Short Sale – If you’re in pre-foreclosure, we might be able to assist you with a short sale. Submit your information on this website, and we will assess your situation to determine how we can help you.
- We Can Buy Your Worcester House – Are you located in Worcester and looking to sell your house quickly? We buy houses in Worcester and are interested in making you an all-cash offer. To get started, simply fill out the form here.
- Get Free Guidance and Resources – Feel free to ask us any questions you have or request free guidance and resources to make an informed decision. We are here to assist you without any cost, pressure, or obligation.
If you find yourself in the pre-foreclosure stage, there is still time to resolve this situation.
Contact your bank or loan holder to explore if they are willing to work with you. Alternatively, you can reach out to us to learn about the potential offer for your house or to access our foreclosure resources, all without any charges.