by Jamie L. Harris
If you are facing a foreclosure suit and are concerned about getting the most value for your home to reduce any potential deficiency claim, there are a number of alternatives to foreclosure:
- Private Sale. If you can find a buyer for your home prior to the actual foreclosure sale, you can avoid a sale of the home on the courthouse steps.
- Forbearance Agreement. If you need some time to market your home, the bank may be willing to enter into a forbearance agreement with you to enable you sufficient time to market the property. As a condition of the bank’s agreement to forbear from collecting against you, the bank may request payments during the forbearance period.
- Deed in Lieu. In order to avoid the costs of foreclosure, the bank may be willing to accept a deed in lieu on the property. Typically, a deed in lieu will only be practical when the bank is the sole lienholder on the property.
- Short Sale. If you are able to find a buyer for your property, but the offer is less than the amount owed on the home, then a short sale may be your best option. Typically, the lender(s) will require you to submit various financials and a hardship application to verify your eligibility for the short sale. If multiple lenders are involved, all will have to agree to the terms of the short sale.