At Utah Best Real Estate we work with an attorney that will be more than happy to work with you and answer any questions that you may have. We don’t make any money referring you to an attorney, so please reach out to us if you’d like to reach out to our attorney to see if Chapter 13 Bankruptcy is the right choice for you.
We can list and market your home on the Utah Multiple Listing Service (MLS) to get the highest and best offer for your home. Allowing you to walk away with the most equity as possible to help with your new beginning.
We also have many affiliates and resources available to you to better prepare you for all of the processes related to preforeclosure. There is no pressure, and no obligation to work with us, but we strongly believe that everyone deserves proper guidance through difficult times.
If you or someone you know has found themselves in the preforeclosure state, there is still plenty of time and resources to fix this situation. We cannot stress enough how important it is to explore your options as soon as possible, contact us today to learn more about what we can do for you.
Homeowners all across the Northern Wasatch Front are constantly facing difficulties with being able to make their monthly mortgage payments in time.
In the particular State of Utah, when a homeowner doesn’t make any mortgage payments for 3 consecutive months, the lender or loan servicer may issue what’s called a “Notice of Default”. This document notifies the homeowner to pay the late mortgage payments within 30 days to “Cure the Default” Utah Code 57-1-24.3 (utcourts.gov). If the late payments are not paid, the lender or loan servicer will issue a sale date notification in 90 days. The 90 day period in between when the Notice of Default is issued and a sale date is issued is known as the “preforeclosure”.
As a homeowner, if you’re 3 months or 90+ days behind on your mortgage payments, you will likely receive a “Notice of Default” from your lender or loan servicer. This document is recorded with the County Recorder’s office and formally begins the foreclosure process. This document is not the same as the “Notice of Delinquency”, Notices of Delinquency are sent in the first month of failed mortgage payments Utah Code 57-1-26. In this scenario, it is of the utmost importance not to panic.
Pre-foreclosure Sale: A preforeclosure sale is one alternative to foreclosure; it saves you time, costly mortgage & lawyer fees and allows you to keep the equity you have in your home to make a fresh start. In a preforeclosure sale, the homeowner, real estate professional, and lender work together to form an agreement to sell a home at current market value; this agreed-upon value is typically more than the existing balance on the homeowner’s mortgage. The property is able to transfer hands to a new owner, removing the overhead and risk from the lender’s portfolio and relieving the existing homeowner of a foreclosure where you can lose much more or all equity. The pre-sale process can prove challenging, stressful, and time-consuming; it requires persistence and dedication. As specialists in preforeclosures, short sales, and foreclosures, the Utah Best Real Estate Team is well-versed in regards to the ins-and-outs of this process, we’re also knowledgeable about the process to move such transactions to completion.
If your home is worth more than what you owe, meaning you have equity in your home, you may be able to refinance your mortgage with the intention of receiving lower monthly payments even if you are behind on your payments. (WARNING: Interest rates are climbing and may not provide a lower monthly payment in the event that you obtained a lower interest rate in the initial loan. Be sure to do your research and ensure that your plan is viable.) The best research you can do in this scenario is to check with your local mortgage broker, or contact us so we can connect you with an institution that is reputable. Given the current market, listing your home and closing a deal within the 90 day pre-foreclosure period may be easy, especially with a knowledgeable real estate agent to help you through the complex legal processes.
As the property owner, it is also possible to contact the lender and ask them to facilitate a loan modification. When negotiating a loan modification, you’re working to modify the terms of your existing loan. This could include adding the payments that are already behind to the back end of your loan, which would change the interest rate or change the length of your loan. This is becoming increasingly difficult as many homes have equity. A mortgage loan forbearance may also be possible if you haven’t already applied. *Keep in mind – Covid-19 created many unique scenarios in every industry and many households, many homeowners have already requested a forbearance in response to being directly or indirectly affected by Covid-19.*
Bankruptcy: Filing for bankruptcy could afford you some time to pay your debt, however, filing Chapter 13 Bankruptcy will significantly damage your credit and the loan amount that is owed will not be forgiven. Meaning that you are still responsible to pay off what you owe including your missed mortgage payments. In the event that you do file, an order called, “Automatic Stay” stops your lender from conducting a foreclosure sale on your home. This will also prohibit most creditors, as well as your mortgage lender from continuing any types of collection efforts without first receiving permission from the court system.
In this present time, lenders are very much aware of the current situation with widespread financial troubles throughout the country and are willing to work with their borrowers most of the time.
If you’re honest and communicate with your lender, you’ll often find that there are options that will allow you to remain in your home, salvage your credit rating and/or walk away with all of the equity in your current home from a pre-foreclosure sale for a brand new start.
A foreclosure can often negatively affect your credit score by 200-400 points and can prevent you from obtaining a loan of any sort for 3-5 years, so be very dutiful if you’ve received a Notice of Default from your lender.
When you are wondering what a pre-foreclosure is, always remember the sooner you find a solution the better. If you need resources or a helping hand to better guide you through your options, please don’t hesitate to give us a call at (801) 214-0990.