When litigating or negotiating a foreclosure with a lending institution most defenses that a homeowner would raise only serve to delay the inevitable, dreaded, foreclosure auction.
While the homeowner receives an immediate psychological benefit of relieving the pressures of the plaintiff’s use of the legal system boring down on them the long term detriment may indeed outweigh the immediate benefits.
In order to get one’s life back “on track” would it not be better to finally resolve the delinquent mortgage situation instead of living with it on an ongoing daily basis? Rarely does anyone discuss the emotional distress placed on the homeowner and family and the corresponding stress indirectly placed on the rest of society.
As long as the foreclosure action is pending it impacts the ability to borrow in the future for another home, for an automobile purchase, and for a myriad of other life issues that necessarily require a modicum of decent credit. However, once the proceeding is resolved without the property being foreclosed upon credit can sufficiently be restored within 2 years to be able to purchase another property.
A short sale provides the ability to neatly resolve all these issues! Within the context of a short sale a professional is negotiating with the lender. It thus opens an avenue of correspondence and communication with that lender. Most importantly, once approved, all litigation is held in abeyance whether one is or is not defending the case.
Not, in any way, to diminish the role that good professionals play in this scenario there are just too many others that falsely advocate that they can win the foreclosure action. This is just a fallacy. Especially here in Long Island, NY.
Increasingly, the Justices in this locale, different from say 15 years ago, will rarely sign any stay orders on foreclosure auctions no matter what the legitimate defense is. So, the homeowner is asked to pay, up front fees of anywhere between $2,500.00 to $7,500.00 to stop a sale when the likelihood of success is de minimis.
The other avenue for resolving a foreclosure proceeding is the filing of a Chapter 13 Petition. This is a fabulous tool as it will automatically and immediately stop any foreclosure auction.
The detriment to filing a Chapter 13 Petition is that it will be a stain on the credit report for many years into the future and more than 90% of all pro se filings are dismissed and so the gains are relatively short lived. The ability to obtain financing will be severely impacted for many years into the future versus selling a property through a Short Sale.
For the homeowner filing a Short Sale there is no cost. Moreover, all closing costs, transfer taxes, recording fees, selling attorney fees and brokerage commissions are absorbed by the lender. There is no upfront money that must be paid to a professional. There are no recurring fees.
The lender typically will also pay for moving and relocation expenses. All it requires is for the homeowner to finally realize it is time to make a move in a positive direction and list the property for sale with an experienced and knowledgeable Short Sale Realtor® who will be able to file the Short Sale with the lender.