Unpredictable financial setbacks may have led you to falling behind on mortgage payments on your Los Angeles home. If you and your household are in a difficult position and are unlikely to catch up with your payments, you might be considering different ways to address your financial concern.
One possible solution you might have considered is to sell your home. But when you’re at the risk of foreclosing, you might be wondering, “Is it possible to sell my Los Angeles house even when I’m behind on mortgage payments?” The short answer: yes, you can sell your property. However, time is of the essence, and here’s what you should know.
Pre-Foreclosure: The First Step To Foreclosure
Once you’ve missed a certain number of payments or are late to pay your mortgage after a certain number of days (usually 120 days after your scheduled mortgage payment), you are considered in pre-foreclosure and your lender can file a notice of default. Check your loan agreement and see if this applies to you, and how many days you have left until your lender issues a notice of default.
This notice of default states that your lender will pursue legal action towards you. If you’ve done nothing to work out your late mortgage payments with your lender and they’ve gotten court approval to hold a lien over your property, they can foreclose your property. You and your household will be evicted from the property, and the lender will put the property on auction or a trustee sale to recoup their losses.
Aside from eviction, getting foreclosed can also affect your credit score. Not only will this bar you from getting better loan deals from banks and lenders (which means higher interests since banks will see you as a high risk), but it can also affect your ability to apply for a credit card, cellphone plan, insurance, and even jobs that involves handling and managing money.
Negotiating With Your Lender
You might be surprised to know, however, that foreclosures are usually lenders’ last resort. The process of filing for foreclosure can be costly and exhaustive, which is why your lender may be more interested with working with you to re-negotiate your payment plan. This is a win-win option for both of you: you get to restructure a payment plan that can ease your financial burden, while your lender can recoup their money and minimize their losses.
If you’re behind on your mortgage payments and have received a notice of default, one of your options is to approach your lender and work out a loan modification or negotiate backdated payments. This may involve extending your loan (which means paying more interest on top of your existing loan), but it could make payments more manageable in the long run – and there’s a chance you could save your house.
Short Sale
If you’ve received your notice of default, another possible option is to sell your home in Los Angeles in a short sale. You will need the approval from your lender before you can execute a short sale. During a short sale, you will put your home up for sale at a price less than the amount due on the mortgage, and the proceeds from that sale will go to the lender.
This can help you pay off your mortgage and can prevent a foreclosure from affecting your credit score, but it comes with risks. Because the selling price is lower than the mortgage due, you’re still in deficit. It’s up to your lender if they will forgive the remaining amount, or if you’ll have to pay for the remaining loan out of your own pocket.
Sell Your Home Before Notice Of Default
If you have yet to receive a notice of default over your property, then you can skip the short sale and sell your home before you reach pre-foreclosure. This can allow you to sell your home at its value, have income to pay off your mortgage, and prevent getting foreclosed.
However, time is of the essence, so it’s important to sell your Los Angeles home fast. The average home in California takes 80 days to sell on the real estate market, and you might not have that time before pre-foreclosure.
Selling to a professional homebuyer is faster than listing your property on the market and waiting for an offer. After contacting a professional homebuyer, expect a fair cash offer within 72 hours or less. After accepting, you can expect closing to take as little as 14 days. This also means no real estate agent commissions and closing fees to eat up what you earn from the sale.
Conclusion
When you’re behind your mortgage payments, you have several options: renegotiate terms with your lender, conduct a short sale to pay off your mortgage, or sell your house for cash fast through a professional homebuyer. In all three options, time is of the essence, so it’s important to weigh out your options before going past pre-foreclosure.
Inhouse Offer buys houses for cash in LA. When you’re behind on your mortgage payments, it might be in your household’s best interest to sell your property before risking foreclosure. Our business process can help you get your house off your hands in a matter of weeks, giving you the financial means to catch up with your mortgage payments and protect your financial stability.
Contact Inhouse Offer today to sell your home in Los Angeles.
