Non-recourse loan: Can I purchase?

Question

I have a potential client that is facing foreclosure. Is it possible to save her? If so what are the steps, she is willing to do whatever it takes to stop the foreclosure.

Wayne Brooks · Answer

Two ways to stop a foreclosure....

1 pay the arrears

2 sell the property

Andy Mirza · Answer

@Deavin Cox It really is as simple as Wayne points out.

Unfortunately, a lot of borrowers in your client's position don't want to face the fact that they cannot afford the home and become desperate in an attempt to save something that they really can't without doing further economic damage to themselves.

Without knowing more details of your client's situation, I can give you only general advice. You can advise her to contact her servicer and apply for a loan modification or forebearance. Each lender will have its own criteria and she may qualify for some relief.

An obvious fact is that she probably needs to increase her income. An obvious way to me to increase income, is to rent out a spare bedroom or take on a roommate. I've come across a lot of non performing loans in which it appeared that a single borrower was living in a three bedroom house. If you can't afford the payment, get a roommate to help! That's house hacking 101. Alas, these borrowers wanted to maintain their lifestyles and having roommates wasn't part of the plan. The answer to that question will tell you how motivated and realistic a borrower is about doing what's really necessary to save one's house.

Another option is getting a loan from family or friends to pay arrears. This is a risky proposition for the lender but I've seen it done.