It is never a pleasant experience to deal with foreclosure as a homeowner. However, financial obligations and mortgage payments can sometimes become impossible to keep up with due to circumstances beyond one’s control.
If you want to avoid foreclosure in Louisville, KY, you can take a couple of routes. While some options merely pause the foreclosure process to give you a much-needed financial break, others can help you avoid foreclosure entirely.
What is Foreclosure?
A foreclosure is a legal process where a lender takes possession of a property after several missed mortgage payments by the borrower. In Kentucky, the foreclosure process is judicial and may take up to five months to complete.
Why Should I Avoid Foreclosure?
The main reason you should always avoid foreclosure is its negative impact on your credit score. A lower credit score, in turn, can lead to difficulty obtaining a job, mortgage, or even a credit line. Furthermore, foreclosure can be a long and emotionally draining process.
Alternatives to Foreclosure
The first way to avoid foreclosure in Louisville, KY, involves paying off the debt. However, it’s likely that you’re not in the best financial position currently to do this. Luckily, there are three other ways you can go about it.
Apply for Forbearance
You can reduce or pause your mortgage payments for a limited time while you rebuild your finances by applying for forbearance. It is important to note that being in forbearance doesn’t mean that your payments are forgiven. Missed payments must still be repaid, which can, in most cases, be done over time or when refinancing or selling. Your servicer will contact you before the forbearance ends to discuss payment arrangements.
Typically, most loans do not have additional fees, penalties, or interest (beyond scheduled amounts) and do not require other documentation to apply. You can contact your servicer for more information on the process.
File for Bankruptcy
A bankruptcy filing can stop your foreclosure sale immediately if scheduled soon. However, bankruptcy can only buy you more time to recover from your financial hardship.
There is no debt cancellation, and the law requires your mortgage company and other creditors to work with you in good faith to create a reasonable repayment plan. Moreover, bankruptcy can also hinder your credit for the next 7-10 years.
Sell the House
The easiest way to avoid foreclosure is to sell your home. Though this can be a difficult decision to make, it can save your credit from the damage caused by foreclosure and allow you to move on. To do this, you can list the house on your own, work with a real estate agent, or contact your trusted cash home buyers in Louisville, KY. You will be able to pay off all the debts you owe the lender, including previous mortgage payments, penalties, and fees, with the money from the home sale.
We Buy Houses in Louisville, KY
At Favor Home Solutions, we’ve helped countless homeowners escape financial binds. Our team reviews your particular case and provides you with a solution tailored to your needs. We buy houses in Louisville, KY, quickly and easily, and there is no additional cost to you.