Can I Sell My Home If I’m Behind On Payments?

With the economy and the housing market in less-than-favorable condition the last several years, many Austin homeowners have wondered if it is possible to sell their home if they fall behind on their payments. It is as fair a question as it is common, and the short answer is quite simply yes. Homeowners who fall behind on their mortgage payments can in fact sell their home, but there are certain stipulations that are specific to that particular scenario.
Behind On Austin House Payment

Selling Doesn’t Make Fees & Penalties Disappear

The first thing to keep in mind is that you as the borrower are still responsible for the payments that you missed, as well as any fees or penalties that go along with them. This is almost across the board since there are few lenders that don’t charge penalties for missed payments. Also, if you do sell your home after missing payments the lender is going to expect full repayment, which more than likely is going to mean that you will end up with nothing once the sale is finalized. You may even end up owing money, since you are still responsible for those payments that you missed. This probably isn’t an issue for those who have an equity position of at least ten percent because they will likely end up with enough to make a full repayment. If your equity position is below ten percent or are underwater (you owe more than the property is worth), it may behoove you to consider a short sale or contact an investment group to take over your payments.

The Long & The Short Of The Short Sale

Short sales are one of the more common options exercised by sellers who fall behind on their payments, but they require approval by the lender, which is not always given. A short sale will at least allow the borrower to relinquish himself from the mortgage payments, although he may take a hit on his credit report because of it. Before you rush to do a short sale or even consider selling your house at all because of missed payments, bear in mind that most lenders don’t begin the foreclosure process until you are 120 days behind on payments; that’s four months. If you miss one month and are able to make the payment the following month that is considered a “rolling 30” – 30 days late but on track to continue making payments. It still counts against you being current on the mortgage, but will help keep the dreaded NOD (notice of default) letters from showing up in the mail.

You’re Probably Holding More Cards Than You Think

There is one key point that homeowners should always remember when they are faced with the possibility of falling behind on their mortgage payments and that is the lending community is not out to get them. They are not holding their finger over the big red FORECLOSURE button just waiting until you’ve missed enough payments so they can press it with an evil grin on their faces. It is in their best interest economically to keep homeowners in their homes. There was a time before the global financial crisis hit in 2008 when this may have been the case, but considering the ocean of distressed homeowners in the current and equally distressed housing market, you as the homeowner are largely in the driver’s seat, so take advantage.

Sell Us Your Home In Austin

If you’d like more information in Austin, TX about how we can purchase your home directly with a short sale, help you sell your home quickly for cash, or even take over your mortgage payments, then contact our cash house buyers at 512-763-0883 today.  We are legitimate professional home buyers which means when we buy houses, we buy as is (no repairs needed) and typically pay all closing cost.  Fast & Easy!