For the past few years, the number of foreclosed homes in the country has continued to increase. Negative equity, rising interest rates, and tough family situations are all common reasons for foreclosure in Little Rock, Arkansas. If you are one of the millions of individuals in the country facing foreclosure, it is important to recognize how the foreclosure process works. This includes understanding the term “pre-foreclosure” and how it applies to your home in Little Rock.
If you’re wondering what a pre-foreclosure is in Little Rock, you have come to the right place to find answers. Today, we’ll explain what a pre-foreclosure means for your home and what you can do to stop a foreclosure. By learning the steps involved with a pre-foreclosure in Little Rock, you can delay and even prevent losing your home.
What is a Pre-Foreclosure in Little Rock?
If you have missed paying at least four of your mortgage payments, your home lender will begin the foreclosure process, also known as pre-foreclosure. This process occurs after missing mortgage payments for approximately 120 days. While a pre-foreclosure can be an emotionally and financially distressing situation, there are a number of options for homeowners to consider. We’ll discuss these options in further detail later in this article.
What Pre-Foreclosure Means for Homeowners in Little Rock
Simply put, pre-foreclosure is the first step of the foreclosure process. In most cases, the bank and mortgage lender will provide three months for the homeowner to become current. If the homeowner fails to make the payments, the bank will continue the process of foreclosing the home and evicting the homeowner.
It’s important to realize that foreclosing a home is extremely expensive for lenders. Many times, lenders will lower payments or reconstruct the loan in order to help the homeowners make the necessary payments. This is why it is important to discuss your options with your bank and lender when facing pre-foreclosure.
After three months of missing payments, your home will go into default. During this stage, homeowners are given the opportunity to repay the loan. If the loan remains unpaid, the lender will take ownership of the property.
A notice of default, which typically begins after three to six months of missed payments, marks the official beginning of a pre-foreclosure. A notice of default is a written notification to the homeowner stating that the lender will seek legal action if the debt remains unpaid. This process can last anywhere from three to ten months.
If you still do not repay the loan after receiving a notice of default, your home in Little Rock will be sold at auction. Once the property is sold, you will be required to vacate the house.
What to Do When Facing a Pre-Foreclosure in Little Rock
If you have recently received a notification stating your home is in pre-foreclosure, there are a few actions you may take. Listed below are some options for homeowners facing pre-foreclosure in Little Rock, Arkansas.
- Refinance your mortgage. If your mortgage is “above water”—meaning you have equity in the house—you may have the option of refinancing your mortgage. As a result, you’ll be able to make lower monthly payments on the property. To find out how to refinance your mortgage, contact your local mortgage broker in Little Rock, Arkansas.
- Catch up on your missed payments. While this option may not be possible in your situation, it is definitely an option worth considering. By catching up on your missed payments, you can stop the pre-foreclosure process for your home in Little Rock.
- Try a short sale. Another option for avoiding pre-foreclosure is having a short sale on your house in Little Rock. Before a short sale can take place, however, you must ask the bank to permit a short sale. If a short sale is permitted, the house will be sold for less than it’s worth. In some cases, you may still have to pay the difference to the bank if the house was sold for less than what is owed on the loan.
- Sell the property to a real estate investor. If you want to sell your house to prevent pre-foreclosure, you may consider selling the property to a real estate investor. Depending on the real estate investor you sell it to, you may be able to sell your house in a timely manner. Certain companies, such as Little Rock Property Buyers, can provide you with an all-cash offer in as little as 24 hours.
Most importantly, homeowners should not panic when facing pre-foreclosure in Little Rock. While pre-foreclosure is indeed a serious situation, there are a number of options available. Homeowners should also note that most lenders are willing to work with borrowers to delay or prevent the pre-foreclosure process. By discussing your options with your lender, you may be able to stop pre-foreclosure on your home in Little Rock.
How Little Rock Property Buyers Can Help
A foreclosure can have a devastating impact on homeowners in Little Rock, Arkansas. Not only does it leave you searching for another property, but it can negatively affect your credit score by 200 to 400 points. In fact, a foreclosure can prevent you from obtaining a loan for up to seven years. If you want to avoid foreclosure and prevent pre-foreclosure, Little Rock Property Buyers is here to help.
At Little Rock Property Buyers, we buy homes in Little Rock, Benton, North Little Rock, and Pulaski county for cash. Unlike traditional home selling, we do not charge agent fees or commissions. Instead, we make a fair, all-cash offer on your property within the same day of receiving your information. Once we write you a no-obligation cash offer for your Little Rock home, we can close your house in as little as seven days.
By selling your house to Little Rock Property Buyers, you can avoid the long, stressful process of pre-foreclosure in Little Rock. Additionally, you can prevent the devastating effects a pre-foreclosure has on your credit score. And because we buy Little Rock homes on our clients’ schedules, you’ll have plenty of time to purchase a new property before you need to relocate.
Ready to sell your Little Rock house to avoid pre-foreclosure? Contact Little Rock Property Buyers today at 501-580-3035, or message us online. We look forward to hearing from you!