Do you know what will happen if you're late for a mortgage payment? It's possible that you'll be facing foreclosure proceedings when your lender thinks that you're no longer capable of paying your debt. If you are already in default then you probably already know about short sales and the two kinds of foreclosures. For best results, I suggest that you consult a real estate lawyer or a tax accountant before making any important financial decisions. But to get you started, let me give you some idea about foreclosure short sale. Let's start with short sale.
Short sale is an alternative to foreclosures. It can happen only if your lender agrees and when the value of your house is less than your mortgage. Let's say Matt has a $150,000 mortgage but his house is only worth $60,000 if we calculate using current standards, then he's qualified for a short sale. Just remember that a short sale is not a money making option. You will get zero money and zero equity because all of the money from the sale will be used to pay off your lenders.
Aside from short sales you can also opt to a foreclosure. As I said earlier there are two kinds of foreclosures, judicial and non-judicial foreclosure. Let's discuss non-judicial foreclosure first. With non-judicial foreclosure your lender (most likely your lender's agents) will act as a trustee and sell your house in a privately run auction.
In essence you'll be selling a deed of trust so this process will not involve the court in any way. With non-judicial foreclosure your lender or your lenders agent will act as a trustee and sell your house in a privately run auction. This process will not have the court involved in any way.
The problem with non-judicial foreclosure is the fact that you will not be exempt from any liability from financial responsibilities more important than your mortgage. The thing about short sales and non-judicial foreclosures is about liability. If you get into short sale and non-judicial foreclosure, your lender will not have any prohibition to go after your assets just to satisfy your debt. However, with judicial foreclosure, you can let the court handle all the legal and financial aspects in the proceeding and that's the end of it.
I will not lie to you. Judicial foreclosure can take significantly longer than short sale and non-judicial foreclosure. It's also much more complicated and expensive than any other proceedings.
The only benefit of a judicial foreclosure is the fact that you can protect your remaining assets (like your second house) from your lenders. When the bank sells your house in a public auction, your lenders can't go after you for any subsequent financial losses. To know more about foreclosure short sale, credit protection, zero taxes and how to avoid personal liability, sign up for my newsletter right away. You will get my exclusive 25 page report and how-to video containing very comprehensive information about the ins and outs of short selling.
And learn how to do foreclosure short sale by watching this informative 15 minute on short sale