Ohio residents who are in danger of having their homes foreclosed will have various foreclosure prevention strategies available to them. In some cases, bankruptcy or simply renegotiating the terms of one’s mortgage can help homeowners in this kind of situation.
Two other foreclosure prevention strategies for homeowners include the “assumption of the mortgage” and taking advantage of a lease-option.
Is my mortgage assumable?
A mortgage gets “assumed” when another person takes over ownership of the property and also takes overall responsibility for the mortgage. These days, most mortgages are not assumable because of the common usage of “due on sale” clauses. These clauses require homeowners to provide the full amount due on a mortgage upon transferring ownership of the property to another individual.
However, many banks are willing to work with debtors’ financial trouble by striking this clause from the mortgage. This, in turn, allows someone — whom the bank approves — to assume responsibility and ownership of both the property and the remaining mortgage debt.
As a part of the mortgage assumption process, the buyer will often pay a lump sum down payment to the homeowner. The homeowner can use this payment to get up to date on his or her past due mortgage payments.
What is a lease-option?
A lease-option is a “rent-to-own” process in which a buyer makes monthly payments while living in a home with the intention of buying it. The buyer will pay a negotiated monthly sum while saving up enough cash to eventually qualify for a mortgage of his or her own.
As long as the lease payments are enough to cover the mortgage, this is a great way for the homeowner to avoid a home foreclosure. Sometimes, the buyer will pay a down payment, which could assist the homeowner to pay the back mortgage payments owed.
Are you behind on your mortgage payments?
If you’re at risk of the bank foreclosing on your property, the sooner you act, the sooner you can engage the most appropriate strategy for resolving the situation.