It can certainly be intimidating when your home looks like it is at risk. Whether it is a lien, a foreclosure or a divorce, it can be extremely intimidating to imagine losing something you’ve worked so hard for.
Even worse is the fact that there are people out there that want to take advantage of your situation to benefit themselves.
Don’t get me wrong: there are still some people that will deal fairly with you during your tough time. A lot of people, though, will certainly see this as an opportunity to use your pain to pad their pockets.
If this is happening to you, here are some things you can consider doing to keep from getting ripped off:
Subject to loans
A subject to loan is a loan where the buyer essentially takes over your loan. If going into bankruptcy, this can be beneficial, as your credit effectively stays from getting destroyed and you can potentially walk away with way more than you would otherwise receive. These can on occasion be difficult, but when approved, work for all parties involved.
Banks know that in the foreclosure process, they can walk away losing a huge chunk of cash from the deal. They don’t want to do that. Often times, banks will accept less than the amount owed in a deal called a short sale. This can often times allow for home owners on the verge of foreclosure to move on from their property without taking a massive dent to their credit, as well as the emotional toll the process takes on them.
Stay away from wholesales
I am not trying to universally give wholesalers a bad name. The reality is, though, that often times, they are trying to come in at a much lower price that you deserve so that they can then flip the house to someone doing renovations for more money. Sometimes they don’t even have the funds themselves and are just getting you under contract to assign their ownership to someone else at a higher fee than they give you. If they can’t do this, then you are stuck waiting for more money and it can be too late in your foreclosure process.
Talk to your lenders
Look, so often people feel overwhelmed in this process and literally try to hide from it. Don’t. Most lenders have souls and want to try to work with you, and a lot of the times there are options for you to use to your advantage. Take them.
I hope this is somewhat helpful to you. I plan on updating this over time with different options that can help ensure you don’t fall victim to scammers or people trying to take advantage of you.