After the housing financial crisis of 2008, when millions of homeowners found themselves overwhelmed with their mortgage payments, this country saw a wave of real estate foreclosures in NJ and other states that went on for several years. When you’re under water with your mortgage, meaning you owe more than the home is worth, you eventually start to wonder if you would be better off by just letting the foreclosure take place. You do have the option of doing a short sale if your lender approves. That means the lender who you owe money to agrees, in some cases, to let you sell the home for less than what you owe them.
After this housing bubble burst, a kind of business many people had never heard of became more commonplace. These businesses work with homeowners who are facing real estate foreclosures NJ and buy their property from them, which stops the foreclosure. Once the acquisition company buys the property, then the homeowner can choose to either walk away and be free of mortgage payments, or the homeowner can stay in the house but pay lower payments to the new owner.
Home owners who are behind on their mortgage payments may wonder about how such a transaction will affect their credit rating. In order to sell to an acquisition company, you have already be in arrears on your payments. Once the company completes the purchase transaction, though, these former home owners can avoid having real estate foreclosures NJ on their credit records, or a judgment on their record. Selling to an acquisition company doesn’t prevent the lender from continuing to report late payments to the credit bureau, so that is something the debtor could dispute with each credit bureau. Just like creditors can report information about you and put it on your credit record, debtors have the right to make a statement on their own credit record. Here, you could make a statement with a copy of the paperwork proving that you sold the property.
Selling to the acquisition company also relieves the debtor of the burden of paying back property taxes on the home. Selling the home this way can put an end to both the foreclosure proceedings as well as collection activity.