One way to stop foreclosure on your home is to sell it and use the proceeds from the sale to pay off the mortgage. Unfortunately, most of the time this is much harder than it sounds. There are two reasons for this:
- First of all, it often takes a long time for a house to sell and if you are facing foreclosure, time is something you don’t have a lot of.
- The other reason is that with real estate prices falling, the amount owed on the home is often more than the house is likely to sell for.
The amount of time you have to save your house from foreclosure can vary quite a bit depending on which state you live in. Each state has different rules governing the waiting periods for each stage of the foreclosure process. To determine whether listing your home is a viable option for you, you need to find out how much time you have. Try to find out the length of your state’s redemption period (if any) as well as any waiting periods, such as the waiting period between the time you receive notice and the time your house will be sold at auction.
Keep in mind that if your state has a redemption period, this period can still be used to sell your home. The money from the sale will go toward paying the lender first, and then if there is anything left over it will go to you. Some states have redemption periods as long as six to twelve months, which is plenty of time for a sale if the house is priced right.
Besides time, the asking price for your home is the most important indicator of whether you will be able to stop foreclosure on your home by selling it. If you price the house right, it should sell quickly. However, pricing is a tricky game. If the price is too high, the house will sit on the market too long. If it is too low, people will wonder what’s wrong with it. Make sure you list your home with an experienced real estate agent who has sold several homes in your area and is likely to have a good idea of what your home will sell for. Explain to the agent that you don’t want to give the house away but you do need it sold quickly, and work with the agent to come up with the right price for your home.
Now what do you do if you owe more than the home is worth? It may still be possible to sell your home and stop foreclosure if you can get the lender to agree to a short sale. In other words, the lender agrees to accept the selling price as payment in full on the loan. However, if you do this, the sale must be complete before the house goes up for auction. Once the sale has been completed, it is too late to do a short sale.
Selling your house to stop foreclosure can help save your credit, but it won’t save your home. Obviously, if you sell your home you will have to find another place to live. Although this is not the optimal solution for most people, sometimes it is not possible to keep your home when faced with a foreclosure situation. Only you can decide whether selling your home is the best option for you to stop foreclosure on your home.