Can I delay foreclosure

Question

Hi allI have a SF rental property in NJ that's facing foreclosure. Title is in the name of an LLC. Are there any steps i can take to delay foreclosure? (I heard there may not be.)Thx in advance!

Dave McIntyre · Answer

Hi Jordan

Thx very much for that response. Let me give some more info re situation.

-Loan bal is around $300k and home worth low $400s.

-I would retail the home but there's a tenant in there I'm trying to evict for non-payment but they're being difficult so I may not be able to get them out in time.

-If I can get them out before foreclosure occurs then I can retail home and pocket some cash, which is why I'm interested in delaying.

Jordan Ray · Answer

Yes! Short sale/Loss Mitigation applications with your agent can avoid foreclosure. You need to hire an agent in NJ that specializes in short sale transactions and has experience with this! The short sale real estate agent should be able to advise you on all of the loss mitigation options and laws specific to your state and help you with each option prior to listing for sale as a short sale and trying to liquidate the property. They should also be able to get paid in certain scenarios other that selling and/or they can charge an up front retainer fee to charge you for the paperwork if that is all they do. In most cases the short sale listing agent would be able to advise of each scenario during your consultation and not charge unless they sell the property. Hope this helps! Let me know if you need help finding an agent that specializes in short sales in NJ!

Minna Reid · Answer

If you haven't already, respond to the foreclosure suit, and also try to get into mediation if you can (many states offer this). You may be declined for not being an owner occupant, but it will still buy a little more time. Uncontested foreclosures move faster.

Also - call the lender and apply for loan mod/forbearance etc. It should buy time, and avoid legal fees being added to the balance as the foreclosure attorneys wont be involved for a while as they process you for different workouts.

Shafi Noss · Answer

Sounds like you are happy with the answers but here is something else to consider: NJ is a judicial foreclosure state so timeline to foreclose is multiple months at a minimum and could even be over a year depending on the tools you have.Is your lender a big institution or a smaller private lender? Smaller lenders might make paperwork errors which can be used to slow things down. Because the foreclosure process is so slow, and nothing is stopping you from selling while it is happening, you may just have enough time to sell the property and capture the equity.

Chris Seveney · Answer

If loan balance is $300k and it's worth $400k and an equity partner puts $40k to bring it current then they have about 40% of equity in the property - now they would not take straight $40k as probably more costs involved. More than likely you would need to give up around 70-80% of equity and own a minority - some deals would allows you to buy it back at a set price as well.

Chris Seveney · Answer

How far behind are you? What will it take to reinstate?

you could ask lender for more time or also file bankruptcy. Sounds like it has ewuity

another is bring on an equity partner

Dominic M. · Answer

Hi Dave, facing foreclosure can be challenging. It's important to communicate with your lender as soon as possible to discuss your options. They may offer solutions like loan modification or forbearance. Additionally, you could explore options like a short sale or deed in lieu of foreclosure. Consulting with an attorney may also be helpful. Best of luck!

Jeff Roth · Answer

Hi Dave in Northern, NJ-

I am sorry to hear you have a single family rental facing foreclosure.

You have it in an LLC and wonder what your options may be to delay foreclosure.

Lenders do not want to take properties back and have a nonperforming loan.

The best time to work with your lender is as soon as possible but certainly before the sheriff's sale.

After the sheriff's sale, there is a redemption period where you can still sell it and the length of time varies from state to state and may depend on if it is vacant (avoid that for a variety of reasons), if tenants have a lease and have rights, or if someone is occupying the property.

Working with the lender may not be easy but do not give up.

Also, reach out to investors, who buy properties in foreclosure or pre-foreclosure, and see if they would be interested in curing the default and buying the property.

To Your Success!

Dave McIntyre · Answer

Hi Minna

Thanks very much for those pointers. Much appreciated!

Dave McIntyre · Answer

Hi ShafiThx for that input. Lender is AMWEST funding. Can't tell how big they are.

Will nevertheless check for any paperwork errors.

Thanks!

Can I delay foreclosure

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