Homeowners with Bank of America who were unsuccessful in acquiring a modification may have pursued a short sale or even a deed in lieu of foreclosure plan, and there are reports that these plans for homeowners who specifically either had there trial modification canceled or were not offered at trial modification upon applying, have seen some mixed results in terms of the availability in helpfulness of these programs. However, there are also options that homeowners have through the Home Affordable Foreclosure Alternatives Program as there are different manners in which some mortgage servicers are dealing with homeowners with negative equity or who want to pursue one of these short sale options.
As an example, not all homeowners are able to benefit from or acquire a short sale as data between June and July, which was released here in October, indicated that Bank of America’s cumulative total of short sale and deed in lieu of foreclosure plans that have been made for homeowners whose trial modification was canceled decreased by almost 100, but for homeowners who were not accepted for a trial modification, the cumulative total of short sale and deed in lieu of foreclosure programs with Bank of America between June and July increased from 31,003 to 34,810.
Homeowners do need to remember that a short sale or deed in lieu of foreclosure plan may cause a setback in terms of their credit score, which has dropped for some homeowners who pursued these specific plans, there are arguments being made that homeowners who have attempted foreclosure prevention, have been unsuccessful, and may be facing financial struggles as a result of personal financial setbacks or negative equity, may be in a better position in the long run if they work with their servicer in this capacity. Some homeowners they struggle to meet their mortgage payment, may face foreclosure or bankruptcy, or see other areas of their financial life struggle, but even with the credit score of some of these homeowners dropping after a short sale, some argue that homeowners who do unload themselves of this particular financial burden when certain circumstances are in place may be able to recover financially in a way that will help them not only avoid damage in other areas of their life but may be seen in a better light by lenders in the future.
Obviously, a short sale is not going to be best for every homeowner and homeowners are still urged to explore not only mortgage assistance plans but any extension programs that may be helpful for their situation, but it’s hoped that homeowners will be able to take advantage of programs like short sales or deed in lieu of foreclosure initiatives as a way to avoid more extreme measures such as bankruptcy or foreclosure. However, as always homeowners may want to consult with a housing counselor or financial professional before opting for a short sale as, once again, it may not always be in a homeowner’s best interest or there could be ways that a homeowner could save their home without resorting to these programs.