The foreclosure process can be long and difficult, in addition to emotionally draining. Homeowners who are facing a potential foreclosure should always seek out guidance regarding the foreclosure process. Although homeowners aren’t responsible for the actual selling of the home–the lender repossessing it is–they might still have responsibilities following the foreclosure process is complete.
Move-Out
Technically, you aren’t required to move out of your house until it’s been sold. Though specific laws vary by state, the method follows a general pattern. In the state of California, when the house is sold, the new owner should issue you a 3-day notice to leave the premises. In some cases, a 30-day notice will be issued. If you do not leave the house, the new owner can file an eviction, which will normally go into effect approximately 30 to 40 days following the expiration of the 3-day notice. An eviction damage your credit rating and may cost you money. If you need extra time to move out, talk to the new owner and attempt to generate a mutually satisfactory arrangement. New owners frequently plan to wait for a few months to move in so that they can make repairs or renovations to the house, which might give you some extra time to package up.
Finding a New House
Although some lenders may offer you house financing shortly after a foreclosure, it might be best to wait for a few years before seeking financing. Waiting to take out a new mortgage will give you time to improve your credit rating again–borrowers with higher credit scores receive lower rates of interest and are sometimes able to make smaller monthly payments down. According to CNNMoney.com, lenders who issue loans to folks who have recently gone through a foreclosure might ask for up to a 30 percent deposit and will lend at a higher interest rate than they would to property buyers with equal credit scores but no foreclosure on their credit report.
Boost Your Credit
Both years that follow a foreclosure are crucial for rebuilding your financial credibility. A foreclosure is a serious blight on your credit history, and it may take time to rebuild your credit rating. Start by analyzing your current situation. Remove any unnecessary spending, for example expensive mobile phone plans or cable tv. Trim your budget and don’t commit to purchases that can stretch you too thin. Be sure to generate all payments to your other duties on time–in case you can’t make a payment, contact the lender and attempt to make arrangements for a payment plan you are able to meet. Don’t allow credit card debt to rise over 30% of your credit line, and also avoid opening too many lines of credit.