Written by Randy on January 22, 2012 – 8:14 am
Are you aware of the common dangers associated with foreclosure and how to avoid them? Whether you believe you can keep the property or not, you need to consider whether you should stop the foreclosure sale or control it’s timing to eliminate a second mortgage, credit card debt and/or unpaid medical bills. Unless a second mortgage was used to purchase the property, the second mortgage can become due when the first mortgage holder forecloses. That leaves you at huge risk and exposure to a taxable event, a charge-off and a collection. All of the above risks could result in you being sued, a judgment filed, liens placed against you and your wages under garnishment.
Though a foreclosure and bankruptcy will certainly damage your credit, the control you gain is even more important, Before the sale the law allows for ways to catch up on missed payments, sell the property or modify the loan and possibly stop the second mortgage as non-payable. By stopping or controlling the timing of the foreclosure you can avoid losing the property, being sued after losing the property and paying taxes on forgiven or lost homes. A foreclosure sale can and does affect your credit rating so strongly that filing a bankruptcy is better for your credit rating by removing your debts that are unsecured. The worst credit credit history is one where you are over your credit limits, have a payment history littered with late payments, even as the debts are being paid and credit histories with judgments and liens. Eliminating your debt through bankruptcy and starting over is much better for your credit score than having unpaid creditors on your credit report showing bad debt that has been charged off, in collections and growing. It is even gaining a new name,”Zombie debt” as it is becoming more prevalent gaining a new name. Practices now include re-reporting of the debt to extend the statute of limitations giving collection agents more leverage to collect. Don’t fall into the “Zombie Debt” trap.
If you are upside down in your mortgage, can’t sell, can’t refinance, can’t modify the loan, consider bankruptcy to control lawsuits, eliminate credit card debt and repay taxes in default.
Whatever you do DO NOT borrow more money you can’t pay back just to try to hold on or catch up.
Don’t let demeaning insults and impossible demands put you further and further behind. We can help with debt management, loan modification and bankruptcy through our partner referral program. We have assembled a leading team of Attorney’s, Accountants, Debt Negotiators and Arbitrators that are on your side.
Call Today 916-660-0605.
