The year 2020 caused many people in Charles Town to suffer financial hardships. They could have incurred massive medical bills due to an unexpected illness, they may have been furloughed from they job only to come back at reduced pay and hours or they may have lost their job altogether.
If these hardships led them to fall behind on their mortgage payments, they may have received a Notice of Default from their lender, officially beginning the foreclosure process. The following are some options homeowners may have in such situations.
Short sales
Selling your home through a short sale may be an option if your home is worth less than what you still owe on your mortgage. A short sale will have a negative impact on your credit, but the impact is not as great as that of a foreclosure.
Deed in lieu of foreclosure
A died in lieu of foreclosure essentially deeds the home back to your lender. You provide your lender with a notarized deed, and the lend forgives what you owe on the mortgage. This cancels the debt, and through that, foreclosure proceedings. While you may not owe any more on your home, a deed in lieu of foreclosure will affect your credit, sometimes the same as a foreclosure would.
Filing for bankruptcy
Filing for bankruptcy is another way to put a halt to foreclosure proceedings. When you file for bankruptcy, the court will issue an “automatic stay” stopping any foreclosure proceedings at least for a while. Depending on the circumstances this could give you the time you need to catch up on your mortgage or find alternative living arrangements should you be unable to keep your home. Bankruptcy will affect your credit, but often can be overcome with time.
Learn more about filing for bankruptcy
Facing the prospect of losing your home can be daunting, but options are available. Ultimately, this post is for educational purposes only and does not contain legal advice. Those who want to learn more about filing for bankruptcy are encouraged to explore our firm’s website for further information on this topic.
