If you’re under financial distress and at risk of losing your Seattle area home, start planning your exit strategy now. After 180 days of no payments, you could be facing a foreclosure and lose all the equity you’ve built in your property.
Thankfully, you have options — including selling your home. But you have to move fast: the sooner you make a plan, the better chance you’ll have of maximizing your equity and avoiding the consequences of a foreclosure.
Start by seeking the advice of a real estate lawyer. In the meantime, read our Seattle foreclosure guide to better understand foreclosure in Washington.
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What to know about foreclosures in Washington
If you’re unable to pay monthly mortgage payments, your lender will eventually seek compensation in another form — your property. The bank will seize your home. This is what’s known as foreclosure.
A foreclosure forfeits all your rights to the property. In most cases, once the house has gone through the foreclosure process, you’ll immediately be evicted and effectively lose any equity you once had in the property. The bank will then sell the home through a local real estate agent or liquidation auction.
Foreclosure can happen to any homeowner. Rarely will someone chose to get into this situation voluntarily. Instead, it’s often the result of an unpredictable problem, like…
- Job termination
- Being unable to continue working due to a medical condition
- Mounting debt and monthly payments
- Unaffordable maintenance issues
How long does it take to foreclose a home in Seattle?
The duration period of the foreclosure process depends on what type of foreclosure your home goes through:
- Non-judicial foreclosure: Does not go through the court and is typically a much faster process (typically 120 days).
- Judicial foreclosure: Goes through the court and can last several months if not years.
The most common type of foreclosure in Washington is a non-judicial foreclosure. And while this means no court action is needed, it does have strict notice requirements which can determine exactly how long your foreclosure period lasts.
Can you get the house back after a foreclosure?
There’s a small chance you might be able to repurchase your home after losing it in a Washington foreclosure, but it’s highly unlikely — and if you had a non-judicial foreclosure, it’s not possible at all.
If you did have a judicial foreclosure (and meet certain requirements) there is typically a one-year right of redemption. If you don’t redeem the home during this time period, your right to get the house back expires forever.
Since reclaiming your home after a foreclosure is nearly impossible, doing everything you can to avoid letting your property foreclose is important — for more reasons than you might think!
The unfortunate consequences of a foreclosure
Being forced from your home is an emotionally challenging experience. Dealing with the uncertainty of where you’ll move and how you’ll handle such a large financial loss is something no one wants to go through.
As if dealing with this stress isn’t enough, there are other long-lasting consequences of a foreclosure that many people don’t realize.
It will hurt your credit score
Did you know a foreclosure stays on your credit report for 7 years.
As soon as the foreclosure appears on your report, you can expect to take big hit — around 85-160 points. This may not affect you too drastically if your credit score was already low, but if you had good credit before the foreclosure, this drop will feel especially hard.
You’ll be unable to buy another home in the future
One of the lesser-known consequences of a foreclosure is that it affects your ability to purchase a home in the future. In fact, you’ll be unable to qualify for a new mortgage for at least 2 years after a foreclosure. And some lenders won’t work with you for up to 7 years!
Even after you do eventually qualify again for a mortgage, you’ll probably be asked to pay a higher percentage towards your down payment. You can also expect to pay more than other buyers in interest fees.
What you can do to avoid a foreclosure
So what’s the best method for avoiding a foreclosure and its unfortunate long-lasting consequences?
Of course, coming up with the funds to pay your monthly mortgage payments is the best solution. But if this simply isn’t an option, then your next best bet is to sell the home. With the funds from the sale, you can pay back the mortgage lender everything you owe. This solution will likely allow you to hold onto some of the equity you’ve built, too.
Selling your home as a solution to foreclosure only works if you do it during the pre-foreclosure period, before it has been sold at auction or the bank takes possession. After that, you’ve forfeited all your rights.
Avoid a foreclosure by selling your home fast, for cash
When you’re at risk of foreclosure, time is of the essence. Like we mentioned earlier, you typically have less than 4 months to find a solution.
Getting your home market ready, going through the selling process (including packing and figuring out where you’ll move to next) is difficult enough without the added stress of a tight deadline and your bank breathing down your neck.
When time is of the essence, the best way to sell your home is to work with a Seattle real estate investment company to sell your home for cash.
There are many advantage to selling your home for cash, but when dealing with a foreclosure, the fact that the entire selling process can be completed in as little as 2-3 days is huge. Plus, there are no extra fees or costs associated with the process.
You won’t have to worry about…
- Real estate agent fees or commissions
- Cleaning your home
- Making repairs
Depending on the investment company you choose, you may even be able to negotiate the ability to stay in your home until you can find your next place to live.
Sound Redevelopment can help during a foreclosure
Sound Redevelopment is a local real estate investor in Seattle, owned and operated by husband and wife team Greg and Laura Perrin. Since 2008, they have been buying homes for cash and helping people throughout the Pacific Northwest avoid the emotional, financial, and devastating consequences of foreclosures.
If you want to sell your foreclosure home for cash, fast, sell to Sound Redevelopment. We’re here to help and would love to make you an offer within 24 hours. Give us a call at (206) 717-5787 or contact us online.