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Getting Back into the Game: Mortgage Delinquency Assistance from a Qualified Attorney and Licensed Real Estate Broker

Posted on in Real Estate

When you purchased your home a few years ago, life was great. Your job was secure, your children were happy and healthy and your marriage was stable, of course with the common marital ups and downs but still reasonably stable.

Then it all came crashing down.

One of your children was diagnosed with a chronic disorder causing medical bills to soar, you became a victim of employment downsizing, and your spouse decided it was all too much and filed for divorce. You are now in danger of losing the family home to foreclosure.

You made the effort to discuss loan modification with your bank but realized you should have retained the services of an experienced Illinois bankruptcy and foreclosure attorney because now in spite of your efforts to persuade the mortgage lender you are now facing the sale of your home via foreclosure or what is commonly known in real estate terminology as a short sale ordered by the lender.

You have no idea what to expect. The Illinois Association of Realtors® and an experienced Illinois bankruptcy attorney can offer you some assistance while you come to terms with learning more about short sales and the loss of your property or significant damage to your credit report.

According to Your Illinois Home, a “short sale” is determined when the homeowner experiences a lapse in mortgage payments and does not have enough equity in the home nor sufficient monetary or liquid assets to successfully satisfy any liens or expenses required to place the home on the market. A short sale is usually reserved for those homeowners who are seriously in danger of relinquishing their property rights due to delinquency of mortgage payments by three months.

Although this is an emotional roller coaster, it may be in your best interest to consult with an experienced foreclosure attorney and seek further assistance by a licensed Illinois Realtor®. While you are awaiting your initial consultation with the attorney, it is best to be wary about the possible rapprochement of scam artists. Consumer groups have advised that becoming involved with anyone offering “we buy houses” or “cash for your home” advertisers will promise a swift resolution of your mortgage crisis but in turn will only ask you to sign over your home and ultimately you will be evicted by the new owner, leaving you still liable to the lender.

This is a time of pure uncertainty and frustration. That is why it is highly advisable to consult with an attorney as well as a licensed real estate broker. Your attorney will be able to advise you of your options with respect to the foreclosure process and possible bankruptcy filing while the licensed agent can complete a Comparable Market Analysis (CMA) to determine the true market value of your home.

When working with both professionals be prepared to do a bit of the work yourself. By gathering the following you will assist in moving the process along:

  • Locate all mortgage documents;
  • Draft a “hardship” letter explaining your recent financial position;
  • Retain at least three months of pay stubs or the equivalent of unemployment compensation;
  • Obtain at least three months of personal checking and saving account statements; and
  • Have readily available at least three years of federal income tax returns.

Finally, with the help of your attorney, the lender should be provided with a letter of authorization before the home can be placed on the market as a short sale opportunity.

The placement of your home as a short sale requires expertise and time. Your attorney and licensed real estate agent can guide you through the process. Be prepared to weather the ups and downs of the overall process for at least 60 days and be aware that any offer tendered must first be approved by your lender.

Deciding to move forward with the short sale process is a personal decision and your attorney may advise you that filing for bankruptcy may be the better option given the impact a foreclosure will have on your credit report rating. Ultimately, you should seek professional legal and real estate advice to determine what you consider to be your best option.

At Newland & Newland, LLP we understand that often life can throw us a curveball and the outcome looks like you will never reach the safety of home plate again. We are here to help. We can work with you to gather all pertinent information and advise you on the ramifications of foreclosure or bankruptcy and which option may be in your best interest. We may also counsel you on the benefits of the HAFA short sale program that offers homeowners incentives to market your home as a short sale. We only ask of you to contact us today to schedule your initial consultation and let us get you back in the game.

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