With the increasing number of homes facing foreclosure nationwide, it is crucial for both buyers and mortgage holders in Edmonton, Alberta, to have a clear understanding of the foreclosure process. Let’s delve into the concept of pre-foreclosure in Edmonton and explore its significance, along with various options available to borrowers.
Understanding Pre-Foreclosure in Edmonton, Alberta
Many homeowners in Edmonton and across the country are currently grappling with financial difficulties, making it challenging for them to meet their monthly mortgage payments. When a homeowner misses 3-6 months of mortgage payments, it triggers a warning referred to as “pre-foreclosure.” During this stage, the lending institution notifies the homeowner about the need to either bring the payments up to date or face the risk of losing their home.
In Edmonton, banks and mortgage lenders typically allow a grace period of three months for the homeowner to catch up on their payments, although this duration can vary depending on the specific bank and individual circumstances. If the homeowner fails to make the necessary payments, the bank proceeds with the foreclosure process, assuming ownership of the home and eventually evicting the homeowner. However, during the pre-foreclosure stage, mortgage holders have several options to explore in order to prevent the loss of their home.
Pre-Foreclosure Options for Borrowers
If you find yourself behind on mortgage payments in Edmonton, it is likely that you will receive a “notice of default” from your mortgage lender. This document serves as an official notification that you have not made mortgage payments for the last 90-180 days. It is crucial not to panic in such situations, as there are viable options available to delay or even prevent the loss of your home.
Consider the following options:
- If your mortgage is “above water” (meaning you have equity in your house), you may be eligible to refinance your mortgage, resulting in lower monthly payments. It is advisable to consult with a reputable local mortgage broker in Edmonton to explore this possibility.
- Another option is to sell your home to a well-established real estate investor in Edmonton, like us at Wade Buys Houses. By doing so, you can use the proceeds from the sale to pay off the months of back-payments owed. We specialize in expeditiously buying homes in the Edmonton area, often closing within a week or two, and offering a hassle-free all-cash transaction that alleviates the stress of finding a buyer.
- You can also reach out to your bank and discuss the possibility of a short sale. In a short sale, you sell your home for less than its current value, and the bank accepts the loss as a tax write-off. However, it is important to note that in some short sales, you may still be responsible for paying the difference if the house does not sell for the full amount owed on the loan.
- If necessary, declaring bankruptcy can provide temporary relief by allowing you additional time to manage your debt. However, it is important to consider the long-term consequences, as bankruptcy can have a significant impact on your credit report for several years.
Lenders are well aware of the financial challenges faced by homeowners across the country, and they are often willing to work with borrowers to find viable solutions. By maintaining open and honest communication with your lender, you may discover options that enable you to retain your home or mitigate the impact on your credit rating.
It is worth noting that a foreclosure can have a substantial negative impact on your credit score, potentially lowering it by 200-400 points and making it difficult to obtain any type of loan for 5-7 years. Therefore, it is crucial to be diligent if you receive a Notice of Default from your lender.
If you are unable to find a satisfactory solution by working directly with your lender, we are here to help. Connect with us to explore potential avenues that may assist you in your pre-foreclosure situation.
How We Can Assist You If You’re in Pre-Foreclosure
- We can potentially help you with a short sale. Share your information on this website, and our team will evaluate your situation to determine if we can provide our assistance.
- We are interested in buying houses in the Edmonton area. If you are considering selling your house, we can make you a fair all-cash offer. Get started by filling out the form on this website.
- You can ask us any questions you may have and benefit from our free guidance and resources. We are committed to providing you with the information you need to make an informed decision. Our assistance comes with no strings attached.
If you are currently in the pre-foreclosure stage, remember that there is still time to address the situation. Reach out to your bank to explore cooperation possibilities, or contact us to discuss how we can assist you. We also offer a range of free foreclosure resources to support you during this challenging time.
Want to Discuss Your Pre-Foreclosure Options?
Call us at (780) 540-2274 or submit your information here to get a cash offer on your house.