Q: I will be relocating. My house has not sold. What are other options to avoid forclosure.
I am trying to avoid forclosure. The house is now on the market and there has not been any interest. I do not want to be a landlord living in another state. But, I definitely do not want to property for forclose. What are other options in the State of Maryland.
A:
A house only goes into foreclosure if the mortgage isn't paid. As long as the owner pays the mortgage, foreclosure should not be a concern, regardless of where the owner lives.
Practically, though, if an owner doesn't have enough money to pay the mortgage if they move elsewhere, two logical options involve selling the property to pay off the mortgage or renting it to generate income for the monthly mortgage payment. Property managers routinely manage rentals for out-of-state landlords, so an out-of-state owner might contact a few property managers to gauge fees for having someone else manage the property.
If the owner attempts to sell but the home is priced too high to generate interest, they might consider pricing according to market conditions for that area. If a property is "under water" -- meaning the mortgage is more than the house worth -- the owner might reach out to the mortgage company to see if a short sale is feasible. A "short sale" occurs when the house sells for less than the mortgage but the lender allows the lien to release. Short sales are not automatic, require the lender's approval and depend heavily on the owner's financial state.
If a lender has initiated foreclosure an owner might also attempt to negotiate a deed-in-lieu of foreclosure. Most banks prefer to get money rather than property but a deed-in-lieu arrangement turns over the property to the lender by deed before the foreclosure finalizes.
Maryland has a foreclosure hotline through the Department of Housing & Community Development. 877-462-7555
Richard Sternberg agrees with this answer
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