If you face the possibility of selling your home, ask yourself the following before starting the process:
- Are you prepared to sell your home?
- Are you unable to recover from a situation that caused you to fall behind on your contract payments?
- Are you unable to afford your regular monthly payment and have no means to catch up on delinquent payments?
If you decide to sell your home, consider the following options.
Short Sale
In a short sale, the financier agrees to discount the contract balance due to hardship. The home is sold but proceeds fall short of the amount owed.
This option may work for you if:
- You can't afford your regular monthly payment and expenses.
- You are interested in selling your home, which is worth less than you owe.
Deed in Lieu of Foreclosure
This option allows you to deed your home back to your financier or investor instead of facing foreclosure.
This option may work for you if:
- You can't afford your regular monthly payment or a slight increase in your payment, plus other monthly expenses.
- You don't have substantial funds left at the end of the month.
Home Affordable Foreclosure Alternative (HAFA)
HAFA provides additional options to avoid foreclosures and offers incentives to consumers who utilize a short sale or deed-in-lieu (DIL) to avoid foreclosure.
HAFA alternatives are available to all HAMP-eligible consumers who:
- Do not qualify for a Trial Period Plan;
- Do not successfully complete a Trial Period Plan;
- Miss at least two consecutive payments during a HAMP modification; or,
- Request a short sale or DIL.