Avoid Foreclosure On Your Ohio Home

Avoid Foreclosure On Your Ohio Home

Avoid Foreclosure On Your Ohio Home

Ohio is seeing its fair share of foreclosures. Banks have different ways of reaching a foreclosure but the end game is always the same. The owner looses their house when the bank is forced to take the property back. In nearly all cases the property has sat empty and damage has occurred from the utilities being off and vandals breaking in to steal copper water lines, appliances or any other valuable component of the house. Banks really do not want a foreclosure. The bank would first choose to help the home owner stay in the home and catch up on their loan through the various loan modification programs or to take the property back through a cooperative situation like a deed-in-lieu or to sell the house through a short sale.

Forecosures in Ohio can be reversed if the seller wishes to put some time into dealing with their mortgage company or obtaining help from a realtor who deals in short sales. A good place for a property owner to start is a forbearance or loan modification. When a homeowner has a temporary loss of income a forbearance might be enough to get things back on track. A forbearance is when your lender works with you to get you caught up on your payments. Often your lender will take the missed loan payments and add them to the end of the mortgage or they could spread it out over many months until you get current. One other solution used when a homeowner has a decrease in monthly income is a modification to the loan. The bank will sometimes lower the interest rate of the loan thus decreasing the monthly payment for the property owner who has had a decrease in monthly income. The catch to a loan modification is the homeowner must qualify for the new payment based on their new income. Everyone who applies for a loan modification will not be qualified since their income has gone too low and there is not a chance of recovery.

The last choice before foreclosure is the short sale. A short sale also known as a pre-foreclosure is when the homeowner needs to sell their house and the balance they owe is higher than what the home will sell for. The mortgage holder would rather do a short sale over foreclosure.. This is a win win for the homeowner and the bank because the bank is able to liquidate the property and take the loss without all the legal costs and damages to the property sitting empty and the seller is able to walk away from the property and preserve their credit. In the past the seller would get stuck with a tax loss payment but the government has temporarily halted tax payments on the loss. This means a property owner can short sale their home and and be free to move on. They pay no money at closing and can get on with their lives. Make sure to talk with your tax advisor since there are some exceptions to the tax payment.

I hope this article gives you some guidance in your financial predicament with your home. You don't need to give up or give in. There is a work around available in nearly all situations involving a possible foreclosure on your Ohio home.

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