Foreclosures are an unfortunate reality of the home-buying process. A home buyer may be well-qualified and well-equipped to purchase a home at the time they are filling out their loan paperwork, but life can throw many unforeseen twists and turns your way.
Life events are probably the most common cause of foreclosure, with these being some of the most frequently cited reasons:
- Medical Issues – Medical issues can be especially destructive financially because they can hit you in two ways. If a serious medical condition is affecting you or a loved one, you may need to take time off of work, or stop working altogether. Additionally, the cost of medical bills – even if you have insurance – can be astronomical. So not only can medical problems keep you from being able to make the income you would normally expect to make, it can also drain your existing financial reserves as well. This can make it extremely difficult to pay for your monthly mortgage payments.
- Divorce – Divorce is another type of life event that can be destructive financially in multiple ways. When a divorce occurs, finances are generally split between the parties, and that may leave one party unable to pay for the home even if they have been awarded it by the courts. Additionally, the cost of divorce is quite high, so if you are experiencing a divorce you may find yourself less capable of paying your home payments due to the legal fees.
- Loss of Job – Losing a job speaks for itself in relation to a foreclosure. The job market has been challenging for certain industries ever since the late 2000s. While some people are able to find a job rather quickly after losing theirs, others are left without a job for several months at a time, especially in industries who have seen their demand decrease due to technology or shifting consumer preferences. These people may find themselves needing to take a job that pays less simply to keep income rolling in, and this may compromise their ability to afford their home.
- Death – Death in your family may present some of the same challenges as medical issues – time away from work, lost income, and the addition of unforeseen expenses.
There is some good news in that foreclosures in 2016 showed a decline from previous years. ATTOM Data Solutions reported that there were over 933,000 foreclosures in 2016. And while that is certainly a large number, it actually represents a 14% decline from the year prior, and the lowest number overall since 2006. That is an encouraging statistic, and it in part reflects that more stringent requirements for applying to purchase a home have been implemented in the past several years.
But because foreclosures are still prominent, it is important that you recognize that alternatives exist. One such alternative is an as-is sale. With an as-is sale, you are able to sell your home for cash. You can do so without making additional investments in the home, such as paying for repairs, paying for supplies to stage the home, or paying costly real estate agent fees.
The process of an as-is sale moves quickly, which is another valuable benefit when comparing it to a foreclosure. Rather than wait for weeks or even months for the bank to work through a foreclosure process, you can sell your home as-is to a cash home buyer in a fraction of the time. A cash buyer will make an offer within just a few days of visiting the home, saving you significant amounts of time. Just how much? Well foreclosures generally take 12-14 months – on the fast end of the timeline. On the longer end, you could be looking at 3 years. That’s quite a lot of time to go through this process, and you will no doubt endure quite a bit of stress along the way. Shortening that timeframe and reducing that anxiety would certainly be beneficial.
Do not assume that foreclosure is your only option when you are behind on our home payments. You may be able to sell your home to a cash buyer on an as-is basis to recoup your losses and avoid the lengthy timeline of a foreclosure. To learn more, contact us today at 314-926-0660 or fill out this form.