Echo’s of “The Great Recession” are still felt by many Americans who find themselves facing difficult times. This includes a large percentage of homeowners. Those who were once excited about their dream home found out a few years later that their loan was in fact, the stuff of nightmares.
Some homeowners have filed bankruptcy and others have attempted paid loan modification assistance. If you are a homeowner in financial trouble considering these two options, there are other choices that may offer better outcomes. The Federal government offers a variety of solutions to assist both military and non-military homeowners.
VA Short Sale Programs Include:
~ Federal Loan Modification
The Federal government offers free loan modification assistance. If you qualify, you will receive a reduction in your monthly mortgage payments. If you are a veteran, the VA will provide direct assistance, even if you do not currently have a VA loan. If you are not a veteran you may want to contact the FTC which can provide free resources, counseling and loan modification assistance.
~ Refinance Into A Federal Home Loan
Refinance into a government insured home loan. Federal FHA and VA loans are available to those who qualify If you have been current on your mortgage payments and all other debt, you may be eligible and this is probably the best thing to try first. These loans offer low, fixed interest rates and easy qualifying. However, you do need equity in the home or need to use the refinance to make home improvements to qualify.
~Pay The Loan Off With A Short Sale VA Loan / HAP Military Short Sale
The VA HLC HAP military VA short sale program is available to veterans and active duty military who need to sell their home for less than what they owe. This program allows the borrower to sell their home and pay off the loan in full. If the seller is unable to sell the home within a set amount of time, the Department of Defense will actually pay the loan off and buy the home from the homeowner.
In an effort to make the process easy, VA HLC will offer free short sale counseling. VA HLC will bring you a qualified buyer and you will not have to pay for the service. In fact, if you use VA HLC for your short sale representation, you may qualify to buy again with a VA HLC loan as soon as the short sale is complete (must be current on all debt at the time of sale). You may be eligible for this even if you have no prior military service. To enroll or to see if you are eligible, call 888-573-4496 and ask to speak with a HAP counselor.
Advantages of Short Selling
Among the advantages of selling with a short sale is the ability to live rent free without moving while you are short-selling. The short sale process may take up to one year. If you are actively short-selling most lenders will not foreclose during this time. A short sale also looks better on your credit report. The debt will be settled or paid in full unlike with a foreclosure or a bankruptcy. If you use a short sale, you qualify to purchase a home much faster than with a foreclosure or bankruptcy. Lastly, buyers who are current and have not defaulted on their mortgage may purchase a new home the day after the short sale has closed escrow.
~ Chapter 7 or Chapter 13 Bankruptcy:
If you are homeowner considering bankruptcy or foreclosure, speak with a VA HLC representative to learn about all of your options first. The call is free but the information may save you thousands and prevent further damage to your credit report. If you are a homeowner considering bankruptcy or foreclosure, speak with a VA HLC representative to learn about all of your options first. The call is free but the information may be priceless. Use the form below to contact VAHLC for more information.
~ Implications of A Short Sale:
Recent changes in lending guidelines allow borrowers to purchase another home immediately after a short sale. For more information, click here.