Today’s housing market is in shambles and with homeowners upside down on their mortgage or in risk of foreclosure, the future is uncertain for many people. Unfortunately, there are always those who will take advantage of this situation and target desperate homeowners using foreclosure resolution scams. Thankfully, there are several safety measures homeowners can take to avoid being scammed.

1. Always work with a reputable company that is approved by the U.S. Department of Housing and Urban Development (HUD). Visit the HUD website before conducting any business to assure your safety.

2. Foreclosure-related services can be expensive but be careful who you pay. Most HUD-approved counselors provide low cost or free services. Never pay anyone until you know what you are getting and be weary of those who collect high fees before rendering services.

3. Get everything in writing. Many times con artists will guarantee that you can keep your home or promise “sure things”. Don’t take anyone’s word for it, always get everything in writing and keep copies for your records. Never make a verbal agreement.

4. Don’t sign anything you don’t understand. Understand deadlines for court papers and lenders but never sign something that has not been fully explained. Many scammers will try to force you to sign under pressure. Instead take time to review and read all documents before signing. It is preferred that you have a lawyer representing your interest review documents before giving the John Hancock. Additionally, never sign blank forms, incomplete forms, or a page with just a signature line. These documents could be manipulated into something you didn’t agree to.

5. Make sure you are formally released from liability for your mortgage debt before signing any sale of load consumption paperwork. Don’t sign away ownership without being sure you are no longer responsible for the debt. It is recommended that you have a real estate lawyer review any deed transfer papers or any other documents related to your foreclosure.

Stephen K. Hatchey, a Florida real estate attorney, can help you navigate this and many other legal matters. To receive a free consultation, contact our offices at 813-549-0096.

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When home is foreclosed in Florida, homeowners’ association (HOAs) liens can be passed on to the home’s new owner. If you buy a condominium or single family home at auction that is included in a mandatory HOA and has been foreclosed on, check to make sure the HOA dues are current. Depending on your state, associations have the right to file a lien on the property for unpaid assessments. Unpaid maintenance fees and HOA dues will continue to increase as the unit or home goes through the foreclosure process. Most associations will try to recover the money (up to 1 year’s worth) from the bank if the lender takes possession of the property, and it does not sell at auction.

HOA liens frequently survive foreclosure and are passed on to the new owner to pay current when the property is bought at auction. The association will not allow the bank to transfer ownership or title to the new owner unless the account is paid. A negotiation in lowering the dues may be done by the bank beforehand in the event that the property fails to appeal to buyers or can be negotiated into the sales price depending on the bank and association.

In most cases, the HOA takes a loss in their fees and end up collecting an additional deposit from new buyers in order to safeguard the possibility of another foreclosure and to make up for lost income.

Stephen K. Hachey, a Florida real estate attorney, can help you navigate this and many other legal matters. To receive a free consultation, contact our offices at 813-549-0096.

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The foreclosure process is a difficult one for all parties involved, the lender, the borrower, and the new owner. It’s easy to forget, or not even know, what all of your options are. The basic foreclosure process begins with a “Notice of Default.” The lender is then responsible for filing a “suit pending,” which gives the borrower 20 days to file an answer to present their side at a hearing. After 20 days, the lender’s attorney will file a motion to declare a summary judgment.

A “Summary Judgment” is a court preceding that determines some or all of the case without a trial. The lender, or bank, is asking for title and possession of the property. Without counterclaims from the borrower, the court will issue an Order of Default, which admits the case. On the other hand, if the borrower submits a response and the matter goes to a hearing where the property owner can submit proofs by affidavit.

In most cases, the borrower will not be able to successfully argue the foreclosure. A sale date will be set within 45 days of the hearing. The judge can extend the sale date out another 120 days if the borrower would like to attempt a short sale. A legal ad of the sale will be published for two full weeks in local circulation before the Clerk of Circuit Court conducts the sale.

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Owning property, particularly residential property, is a big undertaking. There are many people who have a knack for providing the best lifestyle possible for local residents; however, there are some parts of the job that are easier than others. For instance, there are times when certain residents just don’t work out due to late or missed payments. More specifically, it’s difficult when new owners obtain property and have to evict former tenants.

The new owners will typically have a Writ of Possession built directly into the foreclosure proceedings, which means that the owner now has actual possession of the real property. Once these papers have been signed and certified, the current occupants are notified via mail. If the occupants still remain, the papers are delivered to the local sheriff’s office and depending on current volume, authorities will hand deliver the eviction notice. This can usually take up to a month depending on cooperating parties.

Generally within 3 days of the foreclosure sale the borrower specified on the loan would be sent a Notice to Quit. Within 90 days, all residents would be notified of the eviction. It is possible for tenants to remain on the property longer than 90 days if the following circumstances apply, the lease was renewed prior to the foreclosure, if the tenant is not the borrower, if the rent being paid is considered fair market value, or if the tenant continues to pay the rent specified in the lease.

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Every state has a process for homes in foreclosure. What a lot of people don’t tend think about is where will they live after the foreclosure is final. The foreclosure process consists of court hearings, bank meetings, and an auction to sell the property. The title is still in the owner’s name until the final sale of the property, but how long can an occupant remain on the property once a new title is issued?

Depending on how much you are willing to fight for your home, you have 10 days after the auction to object before the court will issue a title. The foreclosure is final when the property is sold “on the courthouse steps” to the highest bidder. The sale usually takes place between 28-35 days after the entry of the final judgment of foreclosure. Many judges will give you 60 to 90 days if you attend the hearing. The amount of time you have left on the property will primarily depend on the motivation of the new property owner.

There are a few things the new property owners will do. The first one is known as keys for cash. Typically you will see offers from $1500 to $5000 to help with relocation, but this will depend on the owner. The second option for new property owners will be to keep you on as a tenant. Some buyers invest in foreclosed properties, but don’t need to have them as a primary dwelling. Finally, the new property owner will ask you to leave within a certain amount of time.

If you have foreclosure questions Stephen K. Hachey, a Florida real estate attorney, can help. Contact him at 813-549-0096.

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The housing market has finally started to turn itself around, there are fewer and fewer “for sale” signs and better mortgage rates than there were 8-10 years ago around this time. However, since the time has finally passed this means that the rough economic decisions you might have had to make might start really showing their true colors. It takes a while for the red to show up on your ledger, but how long, and for what period of time will this red mark remain on your credit report?

A credit report is generally updated every 30 days to line up with creditors billing cycles. Within 30-90 days after your delinquent mortgage payments, the lenders will start the foreclosure process. Once the bank files for a foreclosure, rules the loan delinquent, and processes the sale of the home, the entire process can take between 90-180 days. The foreclosure will appear on your credit report at a similar time. It’s possible for it to show up on your report a few days after the sale, or up to 30 days afterwards depending on where the bank is in their billing cycle.

In some states, the foreclosure process can take several months or even years, while in others, it can happen relatively quickly. Generally, the longer the foreclosure process takes, the longer it will take for the foreclosure to appear on your credit report.

How Does Foreclosure Affect Your Credit Score?

The impact of a foreclosure showing up on your credit report is roughly a 35 percent decrease in your credit score for the first year. The impact is likely to be more severe for the first two years, lessening as time goes on. Ironically enough, the higher your score was before the foreclosure the more negative impact it will have.

According to FICO, the company that calculates credit scores, foreclosure can lower your score by as much as 300 points. This is a significant drop and can make it difficult to obtain credit in the future.

How long does a foreclosure stay on my credit report?

The foreclosure will remain on your credit report for up to seven years, making it difficult to rebuild your credit. The duration that a foreclosure stays on your credit report depends on the credit bureau reporting it, and it typically starts from the date of the first missed payment. Once a foreclosure appears on your credit report, it can be challenging to remove it before the seven-year period is up.

As mentioned above, the impact of foreclosure on your credit score diminishes over time, and you can take steps to rebuild your credit score. You can start by paying your bills on time, reducing your debt, and applying for a secured credit card.

How does a foreclosure affect my ability to obtain credit in the future?

Once a foreclosure appears on your credit report, lenders may view you as a high-risk borrower, and it can make it challenging to obtain credit or loans. If you do get approved, you may be charged higher interest rates, which can cost you more money in the long run.

The severity of the impact of foreclosure on your credit score depends on several factors, such as the number of missed payments, the amount owed, and the time since the missed payment. However, the foreclosure itself can result in a more significant drop in your credit score. It is essential to take steps to minimize the impact of foreclosure on your credit score, such as working with your lender, paying off outstanding debts, and rebuilding your credit. Remember, with the right approach, you can recover from a foreclosure, and it is not the end of the road.

What Can You Do to Minimize the Damage of Foreclosure?

If you are facing foreclosure, there are steps you can take to minimize the damage to your credit score. Here are some tips to consider:

Work with your lender. If you are struggling to make your mortgage payments, contact your lender immediately. They may be willing to work with you to find a solution that allows you to keep your home and avoid foreclosure. For example, they may be willing to modify your loan or temporarily reduce your payments.

Consider a short sale. A short sale is when you sell your home for less than the amount owed on the mortgage. While it will still have a negative impact on your credit score, it is typically less damaging than a foreclosure. Additionally, it can help you avoid the legal and financial consequences of foreclosure.

Get professional help. If you are struggling with your mortgage payments, consider seeking professional help. A housing counselor can work with you to develop a plan to keep your home and avoid foreclosure. They can also help you navigate the foreclosure process and understand your rights as a homeowner.

Rebuild your credit. If you have experienced a foreclosure, it is important to start rebuilding your credit as soon as possible. This can include paying your bills on time, reducing your debt, and using credit responsibly. While it may take some time, you can improve your credit score over time with responsible credit behavior.

Foreclosure can have a significant impact on your credit score and financial well-being. It is important to understand when foreclosure shows up on your credit report, how it affects your credit score, and what you can do to minimize the damage. If you have foreclosure questions Stephen K. Hachey, a Florida real estate attorney, can help. Contact him at 813-549-0096.

 

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Although reports show that the economy is slowly climbing its way back up, there is still no shortage of homeowners facing foreclosure and short sale. This is a very troubling time, especially if you bought your home thinking that you would be able to refinance it, if you ever found yourself in a financial emergency. But with the crash of the housing market and the drop in home prices, many found themselves with no equity to be able to do so. In this event, it seems that renting is the only option. But is it?

Your ability to purchase a home after a foreclosure or short sale really depends on your credit score. When your house goes in to foreclosure, your credit score is greatly impacted. In order to get approval from a lender for mortgage, the lender generally likes to see a score of at least 620. But even then, down payments are going to extremely high and your interest rate may make the purchase not even worth it.

And aside from your credit score, lenders will see the foreclosure in your credit history (missed mortgage payments, ect). This typically will lead a lender into refusing to give you a mortgage. If you were lucky enough to not have the foreclosure reflected on your credit score yet, foreclosures are still viewable by public record and many lenders will pull this record before making their decision.

If you were able to do a short sale rather than foreclose on your home—this is often a better option—your chances of purchasing a house after a short sale are much higher than after a foreclosure. Studies show that there may be little to no waiting period after a short sale unlike a foreclosure that may take up to three years.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.

When it comes to buying or selling a house, taking on an agent can be a major decision. In some cases, an agent may make the entire process easier for you, but in other situations, using an agent may not be cost practical. Below is a list of pros and cons to carefully consider when buying or selling a home.

Selling a Home Pros

A real estate agent has access and knowledge of all the various ways to market your home. He or she will be able to make your home very visible in the market.

This isn’t their first rodeo. A real estate agent will know the ins and outs of selling your home and be able to give you practical advice on the asking price and how to state your house. The agent will also know how to properly show your home and interact with potential buyers.

When an offer has been accepted, a real estate agent will be able to guide you through the process and ensure all legal documentation is completed.

The real estate agent will be able to show your home even if you are unable to be there making your house.

Selling a Home Cons

You will have to pay your agent a certain commission based on the final closing cost. While you may think this ultimately works out for you because the agent will aim to sell the house for as much as possible, they will still be anxious for a paycheck and may cut out your bottom line.

The agent doesn’t need to make your house a priority to sell. He or she can continue selling other houses while your house sits on the market for months.

Buying a Home Pros

Outside of information you can gain online about available houses, an agent will be able to give you more in depth information like the school system, property values, real estate law and other aspects of the process. They may even be able to help you find a mortgage.

You will not have to be super flexible to view homes. An agent has access to show homes even if the seller and their agent are not available. With out the agent, you may not be able to see many homes in one day and you will have to work around when the seller or their agent are available or open houses where there are other potential buyers.

Agents can prepare legal documents and go over them in depth with you. If you don’t use an agent, you may have to seek legal help and have documentation put together by a lawyer who could charge you by the hour.

Real estate agents can negotiate on your behalf without emotions getting involved.

Buying a Home Cons

With all the information online about recently sold homes and homes for sale, it may not seem cost effective to pay an agent for information you can access on your own.

Because the agent has a financial interest in the deal—commission—they may push you to choose and make an offer on a home before you are truly ready.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.