Stopping foreclosure in Orlando
How to save your house from foreclosure in Orlando, FL
An essential guide
The methods in this article for stopping a foreclosure will work but if your income doesn’t change they are just temporary. The fact is, you need hope based on real statistics and fact, not the spin that is heard from TV commercials and social media. The sensible and enlightened homeowner should make plans to sell after the 3rd month of default before the lis pendens notice(suit pending notice)is recorded at the county office.
Since realtors want to make a commission, they will probably recommend a short sale of your home which will extremely minimize your revenue. Plus this has negative credit implications. Asking them to sell your house on the regular market is possible but that would take about 3 months or more and there’s no guarantee that your house will sell. Because of this the best remedy is to find a real estate investor (cash buyer) who can give you a concrete selling price and closing date.
Working with a lawyer?
Although not necessary, hiring a lawyer in Orlando is a valid option that can work for you if your lender has made some missteps in servicing the loan or serving you the ‘summons complaint’. If a bank doesn’t execute legal protocol in these areas your lawyer will be able to detect this and stop the mortgage company from fast tracking the foreclosure.
The next weapon in the lawyers arsenal is to file a ‘motion of opposition’ if the foreclosure referee determines that the answer to the summons complaint is without merit. If that action doesn’t get results your lawyer will be able to help you with your ‘right of redemption’ right before the auction.
For this to work, you have to come up with the sum of the missed mortgage payments plus interest and fees. This must be paid in cash. Don’t forget, if your lawyer does successfully shield you from a foreclosure, he will still have to be paid for his involvement.
You should know that Florida is a non-recission state which means that if you sign an agreement to work with a lawyer you can’t back out with no ramifications. Also, since early 2019 the amount of foreclosures in Orlando have begun to spike because of low wages and rising mortgage payments. Don’t expect close personal attention to your case when there is a flood of other clients in your lawyer’s pipeline.
Bankruptcy
Filing bankruptcy is almost always done through a lawyer but you can do this yourself with the help of a knowledgeable industry insider. With this second option you can file at anytime during the foreclosure process. This provides you an immediate ‘stay’ on all debt collection activities including those of your foreclosing bank.
This last ditch effort is really not a good option in my opinion because Orlando is not hospitable to debtors when they want to start over. LendingTree reports that people who live in this city have difficulty in getting their credit scores up after 3 or 4 years.
Also, bankruptcy is really a payment arrangement in disguise. Whether you file Chapter 7 or Chapter 13, you will be making monthly payments on your mortgage anyway. That’s why most people who decide to declare bankruptcy end up in foreclosure down the line. Ultimately they have both the bankruptcy and foreclosure on their credit report which translates into denials of credit for the next 10 years. Though your credit score will not reflect the bankruptcy and foreclosure after 7 years they will remain on your credit profile for 10 years which loan officers and credit analysts will be able to see.
Things you can do without a lawyer
After 3 months of default you will be served a summons complaint either personally or by mail. Should you choose to fight it you need to ask them directly what your mitigation options are if you are not working with a lawyer. The four main ones are listed below.
A) Forbearance – In this arrangement you will end up paying lower premiums for a while. Some lending institutions may slip you a bad deal where all of the money goes to fees and not to the principle balance. You need to read vigilantly before entering into this kind of agreement.
B) Loan modification – Banks agree to loan modification but it is definitely a rare exception. Data from one prominent American bank shows that only 1% of their applications are approved. Amazingly, most of the homes that have been approved for loan modification ultimately end up in foreclosure because the new agreement will have an adjustable rate. This means that after a certain amount of years the monthly mortgage payments get raised to their original amount which becomes unsustainable. Keep in mind that if you apply for a loan modification and it is not approved (probably will not be) then you will be over 6 months behind in your mortgage payments, creating a larger sum that you will be responsible for.
C) Cash for keys – Banks really don’t want to foreclose because of the legal costs. That’s why it’s been popular lately to offer ‘cash for keys’ where the homeowner turns in the house key in exchange for about 1% of the house’s value. This gives the homeowner somewhat of a fresh start as opposed to nothing at all.
D) Notice of error filing – This is done on the part of the homeowner when he believes the mortgage company has made even the smallest error during the foreclosure process. Sending a ‘notice of error’ helps protect his rights in a court setting. Its important that each time a notice of error document is sent, the homeowner must also send a ‘notice of information’ asking why the mortgage company made the mistake.
Conclusion
There are some individuals that are savvy enough about foreclosure law to really game the system in their favor. This requires being both tenacious and coldblooded. You should ask yourself if you are the kind of person that can live with a high level of stress and still enjoy life. If you are not, your efforts to save your house from a foreclosure will be temporary at best. That’s why selling your house early in the foreclosure process is the best option for people in Orlando who want a fresh and healthy rebound with no encumbrances.