Foreclosures can be devastating, mainly because it involves the risk of homelessness. When you fail to make your mortgage payments to your lender, you run the risk of foreclosure. It is not a surprising reality that Alberta has faced more than a 25% increase in foreclosures in the past two years. If you are going through the risk of losing your home to foreclosure Alberta, you might need to take some preventive measures to avoid that.
To help you save your home, here are five valuable strategies that every homeowner must know about.
Deed-in-lieu of foreclosure
A deed-in-lieu-of-foreclosure occurs when you willingly hand over your home to a lender to avoid foreclosure. Going this path may allow you to avoid paying the remaining loan sum on your mortgage in some cases, but it all depends on your lender’s requirement. You can also avoid the financial problems that come with foreclosures. For example, you can stop your credit score from getting affected by foreclosure.
Ask your lender whether they will waive any deficit amount, which is the difference between the value of your house and the total amount you still owe on your mortgage before you seek a deed-in-lieu of foreclosure.
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Never ignore the communication from your lender.
Knowing that terrible news is on the way can be scary, but ignoring it won’t make it disappear. The first notices you receive from your lender will include crucial information on how to avoid foreclosure. The later notices may consist of important information on the ongoing legal action against you. Failure to respond to the foreclosure notices may result in a judgment against you. It’s important to know that failure to read the notices is not an acceptable reason in the foreclosure court.
Short sale
A short sale occurs when your lender permits you to sell your home for less than the amount owed on your loan. The lender agrees to take the money and forgives any outstanding debt. A short-sale real estate agent in Alberta may be able to assist you in finding a buyer and navigating the lengthy process of securing the appropriate bank approvals.
Liquidate your other assets
Your home is one of the most valuable things in your life. It provides the roof under which you can live and earn your living. Losing the roof from your head can make you vulnerable to more financial problems as you may find it difficult to secure other ways of accommodation. That means you might need to sacrifice your other belongings to save your home from foreclosure.
You might have an additional car, a boat, or other valuable things that can cover your mortgage repayment and avoid foreclosure. Liquidate those assets and pay your outstanding debt so you can prevent the foreclosure of your home.
Understand the details of your mortgage
Locate and study your mortgage documentation to see what your lender may do if you default on your payments. Contact the State Government Housing Office, Alberta to learn about the foreclosure regulations and timeframes since each state has different foreclosure rules. A lawyer can help understand the legalities of foreclosure Alberta so you can take action to save your home.
Foreclosures can cause a massive setback for you and your family. Thankfully, if you know what you need to do, you can take the proper steps to avoid losing your home.
