Can I Sell My Home If It’s In Foreclosure Florida?

Foreclosure occurs when a homeowner is unable to make their mortgage payments on time and has no way to catch up on the missed payments. Because a mortgage is a legal agreement between you and your lender, once you’ve defaulted on the loan, the lender can auction off the property to cover any outstanding debts, leaving you homeless and with terrible credit.

No one wants to receive a notice of foreclosure and yet, in a nationwide study, nearly 1 million Americans were afraid of losing their homes (U.S. Census Bureau Household Pulse Survey, fielded from July 27 to Aug. 8, 2022). And foreclosure can occur from a number of reasons, including:

• Job loss and loss of income
• Divorce or death of a spouse or partner
• Mounting debt, including medical and credit cards
• Moving without being able to sell the home
• Natural disaster

Sell My House Now USA is a local company with their office off Colonial Blvd and Summerling Road right here in Fort Myers operating in Florida that has built their business by buying distressed houses and properties in the area for cash. We are a locally known company, with a proven track record and years of experience helping people like you sell there house before it gets too far down the foreclosure process with the Courts in Lee County, FL. They promise competitive cash offers without the hassle of dealing with real estate agents, title companies, traditional bank financing, and more! More importantly is that our company can close before the foreclosure process is finalized by the Court in Florida. Time is of the essence when you are in the foreclosure process since the lender wants to recoup it’s money as quickly as possible. In most instances, you do not have the time to wait for your house or property to get listed on the market with a realtor, enter into a contract with a buyer then wait for their financing to get approved to close. Taking this route selling your market on the MLS or through Zillow may cause you to lose any equity you may have in your home at a foreclosure sale. When you work with a local professional, home buyer like our company we can close in as little of 7 days. There is no waiting to list the house for sale or having to take both time and money to make repairs to your house. When you list you list your house for sale with either a real estate agent or you list as a for sale by owner it can take months to secure a qualified buyer. You do not have to wait for the buyer to have an appraisal completed for the approval of their loan to close on your house in Florida.

What is Foreclosure?

Let’s say you or your spouse recently lost your job. You still have the same bills to pay but unfortunately you don’t have the money to cover your expenses, including your mortgage payment. What happens now? Even if you find another job the amount of debt you’ve accrued during that time might be too large for you to pay off in a reasonable amount of time. When this happens, the bank starts the process of foreclosure.

How Long Do You Have To Get Out of Your House After Foreclosure?

The steps for foreclosure in most states are missed payments, public notice, foreclosure, auction, and eviction, but the amount of time for each step varies based on state. You could have anywhere from 120 days to nine months before the bank can foreclose using either a judicial or non-judicial foreclosure. During this time, your lender will reach out to you by phone, mail, and email to let you know about the process. Generally, the lender will notify you when you are in default of your mortgage in Florida by way of certified mail.

The Different Types of Foreclosure

There are two different types of foreclosure you may experience:  nonjudicial foreclosure or judicial foreclosure.

What Is Non-Judicial Foreclosure? 

A non-judicial foreclosure is the fastest and cheapest way for a lender to foreclose on your Florida property. It does not require taking you, the homeowner, to court and can be completed according to state statutes. In the case of non-judicial foreclosure, your lender repossesses your home to sell it and recover whatever debt is owed using what’s called a “power-of-sale” clause in the deed of trust. Not every state allows for this option but, if yours does, the lender will generally choose it to avoid any court costs. Non-judicial foreclosure is not available in the State of Florida.

What Is Judicial Foreclosure?

In states that require judicial foreclosure, your lender must file a lawsuit asking the court to issue an order to allow for the sale of the home. In Florida, the lender must first file a lis pendens notice with the Court which puts you on notice that you are in arrears under the terms of your mortgage. The lender is allowed to file a lis pendens notice once you are 120 days behind or in arrears on your mortgage payment. This is the first step in the foreclosure process in the State of Florida when you are behind on your mortgage payment. The lender must provide you with notice that they plan to enforce the terms of the mortgage note that you signed for the purchase of your house. You do have the right to respond to the notice to foreclose on your house in Florida. However, the foreclosure process is very technical and unless you have experience it is required you consult with a real estate attorney in Florida. Whether you agree or not, you must respond to the letter or the lender will automatically win the case and be allowed to put your home up for a foreclosure sale. When the house is sold, you are still required to pay the difference between what you still owe on the mortgage and the amount the house sold for. 

Lis pendens is a notice lenders use when they initiate a foreclosure sale In Florida. It puts the public on notice that a lawsuit is pending and clouds the title so the property can’t easily be sold. Lenders commonly record a lis pendens in the local courthouse or property appraiser’s office when they file a foreclosure lawsuit. You’ll need to know how to respond to this notice to save your home from foreclosure.

The main reason someone files the notice is to notify third-party buyers that there is a dispute concerning the property. It essentially prevents someone from selling the property because potential buyers usually don’t want to acquire property with this type of cloud on the title. In order to get clean title, a local title company in Florida will issue an insurance title policy to the buyer.

Auctions are not like regular home sales and generally the house is not sold for market value. This means that even if your house is in great shape and worth a lot more than what is left on your mortgage, you may still find yourself owing tens of thousands (if not hundreds of thousands) of dollars for a house you no longer own! This is called a deficiency judgment. It’s an expensive and long process for lenders to take to try and recoup their debt, which is why most prefer a non-judicial foreclosure.

How to Sell House Before Foreclosure in Florida

Let’s break down a few ways you can sell your house, depending on your time frame and situation:

Hire A Real Estate Agent

When facing a challenging situation like foreclosure, many Americans turn to local real estate agents as their first step in selling a property. While a skilled agent can leverage their expertise to list your property on the MLS and prepare it for showings, there are drawbacks to consider. Despite their efforts, a significant portion of your sale proceeds typically goes towards the agent’s commission upon closing—ranging from 3% to 6%. For individuals already grappling with substantial debt and aiming to repay their lender in full, relinquishing such a substantial sum may prove burdensome.

Moreover, there is the added anxiety of uncertainty regarding the closing date of your property. Despite assurances from real estate agents, finding the perfect buyer and enduring a traditional 30+ day closing period are still inevitable. This timeline may prove to be excessively long for certain homeowners on the brink of auction or eviction, for whom even a one-month wait could be too prolonged.

Using a real estate agent while you in the foreclosure process in Florida may not be the right option for you. The majority of the buyers that work with a real estate agent require bank financing to be able to close on your property. Most lenders in Florida can take between 30 to 45 days to underwrite and approve a loan to purchase your house. Depending on how far along you are in the foreclosure process for your house in Fort Myers, Florida you may not have the time to wait for a buyer with financing. A lender will also require that an appraisal be completed for the sale of your home which requires more time. A lender also requires that insurance be issued at closing. Florida insurance companies require a 4 point inspection to underwrite and issue a policy for your house. A 4 point inspection report in Florida inspects the following conditions of your home: 1) electrical, 2) Plumbing, 3) Condition of the roof, 4) Condition of the AC system. Depending on the condition of these your house may or may not meet the insurance company’s standard to issue a homeowner’s insurance policy for the sale of your house. You may not have the time to wait for all of these steps to be finalized before your house is Foreclosed on in Florida.

Short Sale

If you owe more on your house than it’s worth, your realtor may require what is called a short sale. A short sale is necessary when you owe more on your house than the property is currently worth. For example:  if you owe $250,000 on your house but in the current market it’s only worth $200,000, you must deal with a short sale. Though it may seem like a good option, it won’t be fast or easy.

To initiate the short sale process in Florida, the first step is to secure approval from your lender. Demonstrating financial hardship with documentation like W-2s, medical bills, etc., is crucial for qualification. If the hardship is due to a long-term loss of income, it must be substantiated as unlikely to improve. In the event of lender approval, engaging a real estate agent and attorney experienced in short sales is essential. Their fees remain consistent with those for a traditional home sale. The short sale procedure in Florida is known for its duration, often taking several months to secure the bank’s consent. Throughout this period, the potential buyer for your property may opt out of the purchase.

If your foreclosure hasn’t dragged on for too long and you’ve maintained contact with your lender, it’s likely that they will approve the short sale. This allows them to avoid the time and expense of trying to foreclose on your property, while still recouping some of the loss from the missed mortgage payments. But for the regular American homeowner, the short sale will follow them for the next 5 to 7 years. 

While selling your house may help pay off some debt, a short sale could harm your credit similar to declaring bankruptcy. Credit unions report mortgage delinquencies and short sales, limiting your ability to obtain credit cards, purchase a car, or secure a new property for a significant period. This financial impact lingers for as long as a bankruptcy on your credit history.

Sell Your House AS-IS to A Cash Buyer

If you’re under a strict time restraint to sell your house before a foreclosure progresses to auction and eviction, you do have options! You can try to sell your property with a real estate agent, work with your lender to complete a short sale, or – best of all – turn to a trusted and reliable cash investor to help you with your situation. However, the sales process working with a real estate agent in Florida may take longer than you have before the lender forecloses on your house. The majority of buyers apply for financing with a mortgage lender which requires a lot of paperwork that requires time to get processed.

Some of the benefits of selling to a direct cash investor include:

• A quick and pain-free closing process.
• Avoid paying any commissions or fees.
• You won’t have to worry about marketing your house and waiting for a buyer.
• You do not have to be hassled with open houses and potential buyers coming to your house at all hours of the day and night!
• No need to spend money on professional photos or staging costs saves you money.
• No need to clean-up or complete any repairs!
• You set the date that you want to close on your property, so you know the exact date that is convenient for you.
• Our home inspection period is less than 7 days compared to 15 days or more when selling your house using a real estate agent.
• There is no mortgage contingency which is normally 30 days or more with a traditional home buyer.
• Many times, the appraisal for the bank comes in under the purchase price which would require you to lower the sales price or have the buyer cancel the contract to purchase your house.

When you sell your home as-is to a direct cash buyer, you not only can avoid losing your home to an auction, but you also may be able to sell the property for enough money to get out of financial debt. Moving on with your life without the burden of a monthly mortgage payment and debt hanging over your head is one of the best gifts you can give yourself! You do not have the luxury of time on your side in many instances when you are trying to sell your house before the bank forecloses on your house. In many instances, your home may not appraise for the sales price to allow a buyer to obtain a mortgage to close on the sale.

Can You Stop Foreclosure Once it Starts?

Pay Off Your Loan & Fees

Are you struggling with a tough financial situation in Fort Myers? Debt is accumulating, and your finances are at a standstill. It’s crucial to take decisive steps and explore methods to eliminate your debt swiftly. One option is to consider liquidating any assets you own. Another approach could be reaching out to friends or family in Fort Myers who may be able to provide financial assistance, either through a gift or a loan, to help you get back on track. If you need a more organized strategy for paying off your debt and steering clear of foreclosure, seeking guidance from a financial professional to revamp your budget might be the way to go. By implementing one or a combination of these tactics, you can tackle your debt head-on and reclaim a worry-free life.

In most instances where you are in pre-foreclosure in Florida, you do not have the financial resources to pay off your loan.

Declare Bankruptcy 

As a last resort, bankruptcy may help you stop the foreclosure of your home but it comes with a high cost. The bankruptcy process is complex and will require a lawyer that specializes in bankruptcy law. If the court approves your petition, you will be entered into a government-approved credit counseling program and the bankruptcy will be reported on your credit report for 7 years. A bankruptcy affects all areas of your life, including when you try to purchase a car, apply for a credit card or bank account, and can disqualify you from future rentals. There are different bankruptcy options to stop a foreclosure of your house. The first one is chapter 7 which is a complete discharge of the bankruptcy and may allow you to keep your house if you it had it as your primary residence in Florida and also had the homestead exemption. The Chapter 7 bankruptcy to avoid the foreclosure of your house is less costly and a quicker process. The second bankruptcy option is Chapter 13 or a reorganization of your assets which is a more costly and lengthier bankruptcy process.

The Homeowner Affordability and Stability Plan (HASP) 

If your debt is higher than your income, you may be eligible for the Homeowner Affordability & Stability Plan (HASP). HASP is a loan modification program targeted at borrowers who are at risk of foreclosure due to insufficient income. This government program was designed to help homeowners in the United States restructure their monthly payments to fit a limited budget. Apply for the program here to see if you qualify.

Sell Your House Fast to a Cash Buyer 

Are you ready to sell your house but don’t have the time to wait 30+ days for a traditional close? Does a short sale seem like a fast way to ruin your credit? Prefer to pay off all your debt at once and get the bank off your back fast? A direct home buyer and cash investor might be exactly the solution you’ve been searching for! When you work with a trusted and reliable investor with a great reputation in your area, you’ll find a helpful company with cash on hand that is ready to purchase your home from your as-is. With a cash buyer, you can skip the lengthy process of foreclosure, eviction, and auction within a matter of days, and save your credit as well!

You may not get full market value for your house or property when you sell to a trusted cash investor, but the timeliness of a fast closing, and the lack of fees, required inspections, and commissions often balance this out at close. Best of all, because an investor can close fast, you can often close before the bank is able to auction off your property! This means you can sell the property for the amount that benefits you versus the pennies to the dollar price the bank will often try to sell your house for just to get it off the books.

We Buy Houses in Foreclosure & Pre-foreclosure – Get Your Offer Today!

Does the idea of finally walking away from a property without the storm cloud of foreclosure hanging over your head? Contact a real professional at Sell My House Now USA to find out more and get a fair cash offer for your property today.