Pre-foreclosure Options

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Pre-foreclosure Options on the Foreclosure Timeline.

Using the same foreclosure timeline, options were put in with the optimal times* to perform them. You are able to stop the foreclosure process at anytime. This is done by requesting the trustee to stop the sale by paying the entire loan balance, plus legal fees and other foreclosure fees.

Forbearance

Before the Pre-foreclosure process you can contact your lender and request forbearance. Forbearance is a process that can help if you’re struggling to pay your mortgage. Your servicer or lender arranges for you to temporarily pause mortgage payments or make smaller payments. This may provide short-term relief however you still owe the full amount, and you pay back the difference later.

1)Account Delinquent

If a homeowner fails to make their monthly payment on time, their mortgage becomes delinquent. The loan is now in "default." The lender should provide the homeowner a Notice of Delinquency and give them the opportunity to make the past due payments.

2)Pre-foreclosure Notice

The lender or loan servicer must mail a notice to the homeowner giving them at least 30 days to become current on the loan ("cure the default") and provide them a "single point of contact" with which to speak regarding their loan. Utah Code 57-1-24.3

Loan Mod(ification)

A loan modification is a complete re-structuring of your home mortgage. The lender who holds your home mortgage may agree to modify your home mortgage by restructuring agreement terms. You can apply for a Loan Modification yourself but you may need or want to retain the assistance of an attorney to help you.

Selling Your Home

As the foreclosure process continues, retaining home ownership becomes more difficult. At this time you may consider selling your home yourself, or more commonly with an Agent.

Selling with an Agent:

Dependent on several factors such as home equity and assessed value. A real estate agent may be able to help list your home traditionally or with a short sale. A short sale is a transaction in which the lender, or lenders, agree to accept less than the mortgage amount owed by the current homeowner.

Selling with a real estate agent will usually get you the most money, but you'll have to move out on closing day.

3) Notice of Default

(Utah Code 57-A-24)

The foreclosure process formally begins when the trustee (a third party, such as an escrow company, bank, or other financial institution, that holds the legal title to the property until you pay off the amount you owe) records a Notice of Default at the County Recorder's office. The Notice of Default is different from the Notice of Delinquency.

Within ten days of recording the Notice of Default at the County Recorder's office, the trustee mails a copy of the Notice of Default to anyone who has requested a copy. You should be sent this notice. It is usually sent by registered mail, requiring you to pick it up at the post office or sign for it. If you do not pick it up, the notice will likely still be valid. Utah Code 57-1-26 (2)(a)

The Notice of Default gives you three months to become current on the payments, and any late fees, legal fees and collection fees. This is sometimes called "curing the default."

Re-instatement of

the Mortgage

Another option to keep the home is a Mortgage Re-instatement. A mortgage reinstatement sometimes called loan reinstatement, is the process of restoring your mortgage after a mortgage default by paying the total amount past due. Instead of foreclosure, you can catch up on your payments and cover any late fees to restore the mortgage by paying the total amount past due. Once you are caught up, the defaulted mortgage will receive a clean slate. At that point, you will continue to make regular monthly mortgage payments for the duration of your loan term.

Bankruptcy

Bankruptcy is a legal process that could save you from losing your home. Depending on your circumstances Chapter 7 or 13 bankruptcy may suit your situation and allow you to stay in your home. Akin to putting a band-aid on top of a major wound; Bankruptcy has serious repercussions and should not be taken lightly. Advice from a legal professional is imperative to this decision.

4) Notice of Trustee's Sale

If you do not cure the default in the three month period, the trustee will record a Notice of Sale and:

-mail a copy to you at least 20 days before the sale (if your deed of trust includes a request for notice, which it probably does)

-publish the Notice of the Sale in a newspaper once a week for three weeks, and

-post the Notice of Sale on the property at least 20 days before the sale.  Utah Code 57-1-26(2)(b) and Utah Code 57-1-25

You can request that the trustee postpone or stop the sale and cancel the Notice of Default by paying the entire loan balance as well as legal fees and other fees associated with the foreclosure.

An Investor

Out of all your options in Pre-foreclosure, Investors are the most flexible and can have very creative solutions. With an investor, you could bypass foreclosure and come out of it with money in your pocket despite poor credit or little equity in the home. Typically investors will offer to buy your home outright with cash, but there are many other options underneath the investor umbrella. These include, creative finance (you can be the bank!) such as subject to or seller finance, rental options, connections to private lenders, renovation and relisting and a plethora of other plausibilities.

5) Foreclosure Sale

At the foreclosure sale, the property will be sold to the highest bidder, which is usually the bank that is foreclosing on your mortgage. At the sale, the bank doesn't have to bid cash. It can bid the amount that you owe them and relieve you of all further financial responsibility. If the credit bid is the highest bid at the sale, the property then becomes owned by the lender.

6) Deficiency Judgment Following the Sale and Eviction Following Foreclosure

Sometimes the property will sell for less than what you owe on the loan. This is called a deficiency. If there is a deficiency, the lender can sue you in court for the difference between what you owe on the loan and the amount the property was sold for, plus their expenses. The lender must sue you within three months after the sale. The amount of the deficiency judgement is limited to the difference between your total debt on the property and the property's fair market value.  Utah Code Ann. § 57-1-32

If you don't vacate the property following the foreclosure sale, the new owner can take steps to evict you. The eviction process starts with an Eviction Notice. If you don't leave by the deadline given in the notice, the new owner will go through the court system to evict you.

You Pick the Option, Pandox can Help

Together we can find the best option.

*optimal times refer to the calculated general optimal time to perform on an option presented, and are concluded through scrupulous study of the pre-foreclosure events in tandem with the options defined. These are however, the educated inference of Pandox, and would be best concluded through personal verification of the information provided above.

Information has been sourced from several sites. If not cited with a hyperlink above the following links will link to the original source of information:

https://www.utcourts.gov/en/self-help/categories/housing/foreclosure.html

https://utahbankruptcy.com/bankruptcy-handbook/filing-for-bankruptcy-in-utah/

Foreclosure help is also provided by the The Consumer Financial Protection Bureau. A list of housing counselors, searchable by ZIP code and you can also get help by calling

888-995-HOPE(4673) to speak with housing counselors available across the country.

Pandox is not a certified CPA firm, law firm, insurance company, contractor, lender, or financial advisor. The content above shall not be construed as tax, legal, insurance, construction, engineering, health & safety, electrical, financial advice, or other form of professional advice and may be outdated or inaccurate; it is your responsibility to verify all information yourself. All information provided above is for educational purposes only.

Overcoming Pre-Foreclosure - Your Guide to Alternative Solutions

Facing foreclosure can be stressful, but you have options to regain control of your financial future. At Pandox, we help homeowners navigate pre-foreclosure with practical solutions designed to protect their assets and credit. If you're exploring alternatives to foreclosure, now is the time to act. We offer alternative strategies to help you move forward with confidence.

Understanding Pre-Foreclosure

Pre-foreclosure occurs when a homeowner falls behind on mortgage payments, prompting the lender to begin the foreclosure process. However, at this stage, homeowners still have opportunities to explore foreclosure alternatives that can help them avoid losing their home or mitigate financial damage.

Exploring the Best Foreclosure Alternatives

Every homeowner’s situation is unique, but there are several alternative options to foreclosure that can help you avoid financial hardship.

Selling Your Property Before Foreclosure

If keeping your home is no longer feasible, selling it can be one of the most effective alternatives to foreclosure.

●        Traditional Sale: Selling at market value can allow you to settle your mortgage debt and protect your credit.

●        Short Sale: If your mortgage balance exceeds the home's value, a lender-approved short sale may be an option to minimize financial loss.

Voluntary Property Transfer (Deed in Lieu of Foreclosure)

This foreclosure alternative allows you to transfer ownership of your property to the lender in exchange for mortgage forgiveness. While this option impacts credit, it is often a better alternative to foreclosure and provides a more structured exit.

Selling to a Foreclosure Investor

One of the fastest alternatives to foreclosure is selling to an investor. A foreclosure investor can purchase your property quickly, often in its current condition, helping you avoid foreclosure proceedings and financial uncertainty.

Foreclosure Prevention Alternatives

Beyond selling your home, several foreclosure prevention alternatives exist:

●        Negotiation with Lenders: Some lenders offer relief programs that can temporarily ease financial strain.

●        Government Assistance Programs: Programs such as Home Affordable Foreclosure Alternatives (HAFA) may help you explore structured foreclosure alternatives.

●        Legal Consultation: Seeking legal advice may help uncover additional foreclosure prevention strategies suited to your situation.

Bankruptcy as a Last Resort

Bankruptcy can temporarily halt foreclosure, giving you time to assess your financial options. However, this alternative to foreclosure comes with significant long-term consequences and should only be considered after all other options have been explored.

Why Homeowners Trust Pandox

At Pandox, we specialize in helping homeowners discover foreclosure alternatives tailored to their needs. Our approach focuses on:

●        Customized Solutions: We analyze your situation and recommend the most effective foreclosure prevention alternatives.

●        Streamlined Process: Our team simplifies the foreclosure alternative process so you can make informed decisions quickly.

●        Expert Guidance: We provide clear, honest advice to help you understand all available foreclosure alternatives.

●        Commitment to Your Success: Our goal is to help you move forward with financial stability and peace of mind.

Take the First Step Toward a Solution

Delaying action can reduce your foreclosure alternatives. The sooner you explore your options, the better your chances of achieving a positive outcome.

Contact Pandox Today:

●        Phone: (385) 567-1820

●        Email: Outreach@Pandoxmarketing.com

●        Address: 1145 S 800 E Suite 110, Orem, UT 84097

Don’t face foreclosure alone—reach out to Pandox today and explore the best alternatives for your future.