Finding Alternatives to Bankruptcy and Foreclosure in New York
At the law office of Michael A. Fakhoury, Esq., PC, we are prepared to help you explore all alternatives to bankruptcy that may be available. If bankruptcy is not an option for you or if you do not wish to file a Chapter 7 or Chapter 13 bankruptcy to address a mortgage issues, you should consider a short sale or a deed in lieu of foreclosure if you intend on surrendering a house.
What Is a Short Sale?
In a short sale, you sell the house to a purchaser for an amount that the bank agrees to. In other words, in a short sale, the lending bank will consider the proceeds of a short sale to satisfy the home loan completely. You will be required to list your home, be prepared for showings, and sell the home yourself or with the help of a real estate agent. As skilled attorneys, our goal is to make it so that you do not owe any money to the lending bank even if you or your real estate agent sells the home for less than what is owed on the home. However, it is important to note that in some cases, if the bank does forgive the part of the loan not covered by the short sale, you may be required to pay income taxes on that portion.
When considering to offer a short sale, the lending bank usually considers the type of loan you have, the value of your home, if your home is your primary residence and if they are better off selling your home to another party for an agreed upon amount as opposed to foreclosing on your house.
What Is a Deed in Lieu of Foreclosure?
A deed in lieu of foreclosure means that you sign over the deed to the bank and walk away from the home. You obviously need the lending bank’s consent to conduct this process. The lending bank considers the following factors:
- The current market value of your home
- The amount of equity or negative equity you have in your home
- If you own other properties
- If the bank would be better off (Net Present Value Analysis) in foreclosing on your home as opposed to offering you a deed in lieu of foreclosure
It is important to consult with an experienced attorney that handles these types of options prior to foreclosure. Usually, after a client meets with one of the attorney’s at Michael A. Fakhoury, Esq., P.C., he or she leaves feeling much more knowledgeable about his or her options and the benefits and consequences of choosing one option over another.
Contact a Fishkill, New York, Mortgage Foreclosure Attorney: Free Consultation
If you are having difficulty paying your mortgage and you have questions about how to handle it, please do not hesitate to reach out to us for help. You can arrange a free initial consultation by calling 845-896-5200 or by contacting our law firm online.