House foreclosure is the last thing that anybody wants to have happen to them. Many people put years of investment into their house and because of unforeseen circumstances may end up facing foreclosure.

As bad as this, it does not have to mean that all that time and effort has to go to waste. With the right strategy, you can still get any value out of your house that is not owed to the bank. This means you can have a good starting place to build yourself back up again. Here are some the different scenarios when this a good option for you.

Positive Equity

You own your home until the bank or lender has sold it at auction. Most houses are generally worth more than the mortgage owed on them. Move quickly and get your home on the market. This is particularly a good strategy if you have not quite reached foreclosure status.

When you have positive equity, you can get the fair market value of your house so you can repay your lender and have some money along with it. Plus, this strategy will help you prevent a hit to your credit score.

Do’s and Don’ts

This is a stressful time and most people generally don’t know what to do. The average procedure is that after you have missed two payments, you will have 90 days to reconcile them otherwise the foreclosure clock starts ticking. After this you will have another 90 days to renegotiate the terms of the contract and ask for a loan modification.

Many people during this time essentially bury their heads in the sand. They ignore the letters and hope to figure out a solution. Don’t do this! You need to communicate with your lender. This will help them be able to give you a more flexible solution.

Notify your lender of your intentions to the sell the house and keep them up to date about how the process is going. This is when you need to be getting your house into the best shape possible. And one more thing. Don’t miss you homeowner’s association payments if you live in one. This can give the HOA the right to foreclose on you before the bank.

Avoid the Real Estate Agents

Real estate agents provide a great service and usually they are very helpful. The problem is that if you find yourself in this situation then you likely have other financial issues to contend with and every dollar counts. Commissions for real estate agents vary significantly, but it is often a lot of money that you could use for other purposes.

When this is the case try to opt for a cash buyer instead. They also can help you sell your home a lot quicker too! Cash buyers can save you the hassle of dealing with banks so you can get you your money much more quickly.

It’s Not the End of the World

Home foreclosure is not a fun situation to be in. But with the right planning, you can get out from under your debt and be able to have tools necessary to get back on the right path to financial stability again.