Foreclosure permanently damages your credit.
We negotiate with your lenders to settle for less than you owe,
so you avoid foreclosure.
Owe more than your home is worth?
Lost equity due to market conditions?
Unable to sell an investment property?
Missed mortgage payments?
Facing a hardship?
Your lender may settle
for less than you owe, while
you protect your credit rating!
Our Commitment is to you.
The Distressed Real Estate Solutions Division of The Fuchs Group at RE/MAX Fine Properties provides real estate marketing services to avoid foreclosure and protect your credit rating. We provide legal, lending, and accounting professionals so you may explore all possible options.
A property is considered distressed when more is owed to the bank than the property is worth. A homeowner unable to make their mortgage payment due to job loss, change in marital status, or increased monthly payment due an adjustable rate mortgage will face very difficult legal and emotional decisions. Foreclosure is devastating to your credit rating and ability to purchase real estate in the future; it should be avoided if at all possible. Regrettably, many homeowners do not pursue their options soon enough to avoid foreclosure.
What we do and how we do it.
Distressed Real Estate Solutions supports both home sellers and buyers of distressed real estate. For “upside down” home sellers we utilize a proven high-degree-of-probability short sale process to sell your home prior to foreclosure which protects your credit rating. The bank pays our fees.
We support home buyers with an analytic approach of understanding community property values and opportunities.
Please click the ‘Contact Us’ button for a free confidential review of your situation and needs.
What does it mean when a homeowner is "short" on the closing?:
When a borrower owes an amount on the property that when combined with closing costs and commissions, is higher than the current market value.
A short sale occurs when:
A negotiation is entered with the homeowner's mortgage company or companies to accept less that the full balance of the loan at closing. A buyer closes on the property and the property is sold "short".
A foreclosure occurs when:
There is a legal proceeding by the lien holder in which they take back the property in order to recover the amount that is owed by the homeowner.
Alternatives to Foreclosure:
There are many solutions to foreclosure; click here to learn more about the pros and cons of each.
Links to web sites that provide information about foreclosure.
Arizona Foreclosure Law
Common Foreclosure Terminology
IRS Home Foreclosure and Debt Cancellation
Arizona Foreclosure Process
Arizona Foreclosure Process Flowchart
Foreclosure Rescue Scams
Freddie Mac's - Do's and Don'ts of Foreclosure
Tax implications on Cancellation of Debt
Following is a brief explanation of Foreclosure Alternatives, including their benefits and drawbacks:
A reinstatement is the simplest solution for a foreclosure, however it is often the most difficult. The homeowner simply requests the total amount owed to the mortgage company to date and pays it. This solution does not require the lender's approval and will 'reinstate' a mortgage up to the day before the final foreclosure sale.
- Benefit: Does not require the mortgage company or lender's approval.
- Drawback: Requires that a homeowner be able to pay all back payments, fines and fees.
Forbearance or Repayment Plan
A forbearance or repayment plan involves the homeowner negotiating with the mortgage company to allow them to repay back payments over a period of time. The homeowner typically makes their current mortgage payment in addition to a portion of the back payments they owe.
- Benefit: Allows the homeowner to make back payments over time.
- Drawback: Requires that a homeowner be in a financial position to pay not only their current mortgage, but also a portion of the back payments owed. Some mortgage companies will require a homeowner to 'qualify' for forbearance.
A mortgage modification involves the reduction of one of the following: the interest rate on the loan, the principal balance of the loan, the term of the loan, or any combination of these. These typically result in a lower payment to the homeowner and a more affordable mortgage.
- Benefit: Reduces the payment a homeowner is required to make on a monthly basis and may reduce the principal balance of the loan
- Drawback: Requires that a homeowner 'qualify' for the new payment and will often require full documentation. Lender has to be actively pursuing modifications.
Rent the Property
A homeowner who has a mortgage payment low enough that market rent will allow it to be paid, is able to convert their property to a rental and use the rental income to pay the mortgage.
- Benefit: Allows homeowner to keep property indefinitely.
- Drawback: The issues that can arise with a rental property are many, and rent often does not cover the full cost of property ownership and maintenance.
Deed in Lieu of Foreclosure
Also known as a 'friendly foreclosure', a deed in lieu allows the homeowner to return the property to the lender rather than go through the foreclosure process. Lender approval is required for this option, and the homeowner must also vacate the property.
- Benefit: Many times in a successful deed in lieu, the lender will forego their right to a deficiency judgment.
- Drawback: Requires that a homeowner vacate the property, and a deed in lieu may be reported to credit bureaus as a foreclosure.
Many have considered and marketed bankruptcy as a 'foreclosure solution,' but this is only true in some states and situations. If the homeowner has non-mortgage debts that cause a shortfall of paying their mortgage payments and a personal bankruptcy will eliminate these debts, this may be a viable solution.
- Benefit: Does not require lender approval.
- Drawback: If a homeowner cannot afford their mortgage payment, a bankruptcy will only stall—not stop—the foreclosure process. Bankruptcy can be costly, is damaging to credit scores, and can only be declared once every seven years.
If a homeowner has sufficient equity in their property and their credit is still in good standing, they may be able to refinance their mortgage.
- Benefit: In some cases, this will lower payments.
- Drawback: In today's market, a refinance will almost always raise mortgage payments, and is an expensive process.
Servicemembers Civil Relief Act (military personnel only)
If a member of the military is experiencing financial distress due to deployment, and that person can show that their debt was entered into prior to deployment, they may qualify for relief under the Servicemembers Civil Relief Act. The American Bar Association has a network of attorneys that will work with servicemembers in relation to qualifying for this relief.
- Benefit: If qualified, this will lower payments on all consumer debt in addition to mortgage payments.
- Drawback: Must be active military to qualify.
Sell the Property
Homeowners with sufficient equity can list their property with a qualified agent that understands the foreclosure process in their area.
- Benefit: Allows homeowner to avoid foreclosure and harvest some of their equity.
- Drawback: In many cases today, homeowners do not have sufficient equity to sell their property without negotiating a short sale (see next solution).
If a homeowner owes more on their property than it is currently worth, then they can hire a qualified real estate agent to market and sell their property through the negotiation of a short sale with their lender. This typically requires the property to be on the market and the homeowner must have a financial hardship to qualify. Hardship can be simply defined as a material change in the financial stability of the homeowner between the date of the home purchase and the date of the short sale negotiation. Acceptable hardships include but are not limited to: mortgage payment increase, job loss, divorce, excessive debt, forced or unplanned relocation, and more.
- Benefit: A short sale allows the homeowner to avoid foreclosure and salvage some of their credit rating. This also keeps foreclosure off the individual's public record, and in many cases will allow the homeowner to avoid a deficiency judgment. Borrower may qualify for another mortgage in as little as 24 months (as opposed to five years for a foreclosure).
- Drawback: Short sales can be a trying process in which a homeowner is best served by contracting with a qualified real estate agent to guide the way.
This represents only a summary of some of the solutions available to homeowners facing foreclosure. Please call or email to discuss your individual situation.
MORTGAGE ASSISTANCE RELIEF SERVICES (MARS)
The Fuchs Group RE/MAX Fine Properties is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan. If you stop paying your mortgage, you could lose your home and damage your credit rating.