It’s Good to Know All Your Options

In another of my articles I dealt with the issues of developing trust and getting a fresh start. Not only will developing trust with your Short Sale clients be important in this business, trust is the building block to doing business with anyone.

I have to admit, I’m no Mother Teresa. I’ve told my share of white lies in my life, most of them to my wife who is a terrible snoop during the holidays. But when it comes to telling the people going through a foreclosure their options, the truth is the only thing that matters. My goal is always to be brutally honest with people at all times.

This article will deal with not sugarcoating the situation people going through a foreclosure are in and laying out those options in a way that is understandable. If you don’t know what all the options are, maybe the list below will help.

If your goal is to assist these people through the Short Sale process, regardless if you are working these properties as a Real Estate professional or an Investor, you need to be able to explain to them the options they have.

There is a difference the impact a full blown foreclosure has on your credit report as opposed to a successful Short Sale. Neither is very good to their credit rating, but according to my sources, they both stay on your credit report. The full blown foreclosure will stay on longer than the Short Sale.

The same with a full blown Bankruptcy, I would have never gone that route myself if I had known how adversely it effected our credit for many years after our financial troubles were over. That’s what I get for listening to an attorney!

What are the REAL options for a property owner?

·        Get caught up and get the loan reinstated
·        Work out a loan modification with the lender (Very popular now)
·        Sign a forbearance agreement with the lender
·        Sign a Deed in Lieu of Foreclosure
·        Sell the property before the foreclosure runs it’s course
·        Short Sale the property
·        Let it go through the full blown foreclosure, being sold on the courthouse steps
·        Declare bankruptcy and try and save the house through a re-organization plan

I will always try and explain as best I can what all the options are and the plusses and minuses that come with them. Since I am not an expert in either the legal end or credit implications that each would bring, I just relate my personal experiences.

I always want people making decisions to work with me making those decisions with their eyes wide open. My advice here is to explain the options, the good, bad, and the ugly. In the business of foreclosures, there are so many people out there that work by taking advantage of people in this situation. Please, don’t be one of them.

Educate yourself, and then educate your clients or customers as to what their REAL options are and let them decide. If you have been straight and honest with them, they will ask for your advice and look at you for guidance.