Foreclosure and Notice of Default

In Ohio, a Notice of Default is a legal document filed by your lender. This is their official attempt at filing for foreclosure with the intent to auction off the home. Typically, a few things need to occur before a Notice of Default is filed:

• You are 120 days and at least 3 payments behind on your mortgage
• Your lender has attempted to contact you at least 30 days before the Notice was filed
• A follow-up meeting was offered within 14 days of the first one
• You have a person managing your account with the lender whom you can contact directly
• The lender has sent a “Demand” or “Breach” Letter which is a 30-day warning before filling the Notice of Demand

Perhaps you’ve already tried a loan modification but finances never turned around and you still can’t make the payments.

Once you have the Notice of Default you have about 90 days in Ohio before receiving a Notice of Sale. Notice of Sale is the date the lender plans to auction off your house. Can you avoid this from happening? Here are three options to consider:

• Deed in-lieu of foreclosure. This can release you of all or most of the remaining loan balance in exchange for the deed. This option may allow you to avoid an auction, may cost you less in fees and penalties, and generally avoids public record of foreclosure. You will still lose your house and any equity built up. You may consider contacting an attorney to discuss damage to your credit and possible financial consequences. The bank must approve and allow you to proceed with deed in-lieu process; similarly to the short sale (discussed below), burden of proof of hardship is on you.
• Short Sale. Fortunately for borrowers, there is another option that is time consuming and complex but nevertheless it is much better than a foreclosure. In some cases, a competent real estate agent can list your home and try to sell it to a willing buyer for less then what you owe in your mortgage balance. If a buyer for the home has been identified and the lender is willing to take less than market value for the property, then you may sell your home via a short sale. Several things need to fall into place or a successful short sale. The house needs to be in a ‘decent’ condition – buyers mortgage provider will send an appraiser to determine if the house is in a good enough shape to be approved for a mortgage. The buyer must be wiling to wait an indefinite amount of time; a short sale can take 60-90-120 days or even longer; your lender must approve you to have a short sale and the burden of proof is on you, the seller. The seller/homeowner must compose a hardship package and if the lender feels that the seller qualifies, the lender will allow a short sale. Lastly, the lender will send out two BPOs (Broker Price Opinions) to your home to determine what they will ‘accept’ for your home. In addition to what the lender is willing to accept, the lender and the seller are responsible for real estate fees and closing costs. If the dollar mount is more then what your buyer is willing to pay, you will need to find a new buyer.
• Sell to a cash investor. The last and the easiest option is to sell to a cash investor. Whether you are a few payments late on your mortgage or the foreclosure process has started and you have just received a Notice of Default or if you are well into the process, we may be able to help. Every situation is different and we can only determine if we can assist you once we discuss your individual situation. If we determine we can help, we can buy your house in as little as 7 calendar days, in some situations even faster.

You don’t need your lenders permission to sell if you are a lawful owner of a home. Up until the foreclosure is finalized, you can choose to sell your home to a buyer, as long as the outstanding debt is covered and a buyer is willing to pay the full mortgage debt, unpaid taxes and any other liens or debts associated with the house.

Our process is simple and we can usually make an offer on the same day. If you choose to accept our offer, we will hire a local title company to handle the closing process and pay you in cash. No need for inspections, no need for repairs, no public notice of foreclosure. We buy as-is and we pay cash.

Let us help you put your mind at ease so you can focus on the next steps in your life. Contact us for a confidential conversation! We are here to help!