The Mark Spain Team

Atlanta Real EstateHow to Avoid Foreclosure

While the economy is slowly improving, foreclosure is still a very real risk for many people. In fact, Georgia continues to rank in the top 10 for most foreclosures. However, if you or someone you know has gotten behind on your mortgage, options do exist.

A big first step is to contact your bank or mortgage loan servicer and explain your situation. Perhaps you were unemployed, but just started a new job and need to work out a payment plan for past due payments and penalties. Or your financial situation may continue to be challenging. Either way, your mortgage company needs to know and may have a few options to suggest to you.

The term “short sale” is also becoming increasingly popular. Five years ago, very few people were selling their home via short sale. Google the term “short sale” now and you get around 168 million hits! A short sale involves selling your home for less than what is owed to the bank. Both you and the bank must agree to the terms and amount.

Having a Realtor experienced with short sales is essential in the complicated negotiation stage of a short sale, particularly if you have liens on your property or a second mortgage. Georgia is also a deficiency state, meaning you could be made to repay the deficiency between the original mortgage note and the amount the home sells for now. An experienced short sale real estate agent can work to sometimes get these deficiencies waived in your short sale.

Short sales result in less long-term damage to your credit score. And, when your life is later more financially on track, you can buy another home far sooner than if you had a foreclosure in your credit history. Simply walking away from or abandoning a property is also discouraged. It will lead to foreclosure in the end and you are relinquishing all control to the bank in a foreclosure.

A short sale can take several months so don’t delay beginning the process. Loan modifications are another option I will cover in a future column. These, too, can take many months to complete. Be aware that applying for a loan modification often stops the short sale approval process completely (i.e. they cannot be done concurrently).

For more information on short sales, visit
http://ping.fm/nT6eW (a HUD site)
http://ping.fm/mswgC (free report there)
http://ping.fm/fjU2Y

Mark Spain is a Realtor with RE/MAX Greater Atlanta, is one of the top 20 RE/MAX agents in the world and the top RE/MAX agent in Georgia for closings. He is Short Sales and Foreclosure Resource (SFR) certified by the National Association of Realtors and earned his Certified Distressed Property Expert (CDPE) designation. He is a native Atlantan and graduate of the University of Georgia. To get answers to your real estate questions, visit www.MarkSpain.com or call 770-886-9000. For details on considering a short sale, visit www.GreaterAtlantaForeclosureHelp.com