Las Vegas Foreclosure

What are my options?

Most Las Vegas homeowners who are in foreclosure have a limited knowledge of what their options are. I have seen many instances when the Notice of Default was filed and the homeowner simply packed up and left, thinking the bank had repossessed the house. They had no idea they could have lived in the house for four more months. Had they had a better understanding of the foreclosure process, they would have at least been able to make an educated decision.  It is also helpful to understand the terms related to the foreclosure process.

With the goal of educating homeowners, here is an overview of the options a homeowner has when in foreclosure. Remember, each foreclosure situation is completely different and some of these options may not be available for everyone.

The homeowner can reinstate the loan.

Let’s say the total amount owed the bank, including back payments, late fees and Trustee fees, has added up to $10,000. If the homeowner pays the bank the $10,000 they will have reinstated the loan. More often than not, the homeowner does not have $10,000 in their bank account. For this reason the reinstatement option is not an option.

The homeowner can negotiate a forbearance agreement.

Using the same scenario, the homeowner owes the bank $10,000 to bring the loan current. The homeowner negotiates with the bank to set up a payment schedule, on top of the regular monthly payment, to bring the loan current. Typically the bank will want $2,000 to $3,000 up front and will spread the remaining amount on top of the next six months' payments. Often, this option is not possible as the homeowner cannot make the larger payment.

Homeowner Beware!

Homeowners beware - there are some companies in Las Vegas that claim their specialty is setting up forbearance agreements to help you avoid foreclosure. They will charge you an upfront fee, and at least half the time, they don’t successfully get it done. In foreclosure real estate you should never pay anyone up front. Besides, negotiating forbearance agreements with the lender is something homeowners can do themselves.

In the state of Nevada, if a bank accepts less than the full amount owed, they are jeopardizing their position. It could be that the foreclosure process will have to be started all over again.

The homeowner can file a bankruptcy.

While this will definitely stay the foreclosure proceedings, many times it does not save the house. In late 2005 some of the bankruptcy laws were changed, making it a bit more difficult to file. Many homeowners will opt not to file a bankruptcy so as to not scare their credit any more than it already is. In my opinion bankruptcy should be a last resort. It is costly, time consuming and a huge headache.

The homeowner can do nothing.

Due to a lack of knowledge and/or motivation, many homeowners will do nothing and let their house go to auction. While this is the worst decision possible, it is an option many homeowners choose to exercise.

The homeowner can sell the house.

Many homeowners don’t realize this is a viable option. They may be in foreclosure, but they are still on title to the property. If the other three options are not possible, selling the house is a must. Many Las Vegas homeowners have huge amounts of equity in their house. They can sell and realize the equity in their pockets.

Las Vegas foreclosure is a time sensitive issue. The homeowner needs to assess their options, make a decision and set a course of action in place.

For the most trustworthy and objective advice on Las Vegas foreclosure real estate, contact your Welcome Home Nevada agent today.

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