In times of economic uncertainty, it is very easy to fall behind in a mortgage payment. Perhaps it could spiral from not being able to work for a few weeks due to illness, or going through a divorce, serving military service, losing a job or perhaps the death of a wage earner. No matter the reason, there are many people who do not have enough or any savings put aside for that “rainy” day, and when the money is no longer there to pay the bills, then the usual next step is becoming delinquent in the mortgage payment. Being in default just means that you are 30 days or more behind in your mortgage payments.

People do not realize that there are usually 1.3% of people defaulting on mortgages in a healthy market. In 2005, foreclosures had increased every single quarter. By 2006 there were 1.2 million filings across the country and by 2008 (realtytrac.com), more than 9% of mortgages by the second quarter were delinquent (housing wire.com).

It has been stated that foreclosures were fewer the first quarter of this year, but do not be misled by numbers. Foreclosures are happening, now also in the higher priced properties, and each and every one of those people need good sound advice. As a real estate professional, and being a CDPE (Certified Distressed Property Expert), I am not in the business in offering advice to people with regard to their financial obligations. I leave that to your accountant, your tax attorney and business manager. However, I can sit down with you, and should you choose to have a short sale on your property, then that is where I can be invaluable - in helping you to walk through the process. Read more on the short sale process in a previous post of mine.

As a judicial state, foreclosures can take up to one year in New York. In non-judicial states, foreclosures can occur within 30 days of being in default of the mortgage (although I understand they are still taking 4-5 months).

Do you have a security clearance (work for a bank, the military, etc.) or do you have an FHA loan? These are all factors that could affect your choice in seeking a short sale or not being considered for one. Are you aware that if you should have a foreclosure, it will always remain on your credit report? If you should go bankrupt, that will reflect on your credit report for 10 plus years?

If you have any questions with regard to the short sale process, please contact me, and as a Certified Distressed Property Expert, it would be my pleasure to sit down and chat with you. I am patient, caring, and here to work to work on your behalf.

Posted by:  Gay E. Rosen