Foreclosure is not the only way

I have a friend of a friend who just wants to walk away from his investment. Waited to long to do anything about it and now is running out of options. Many people have made their fortune through foreclosure sales. And the numbers are rising at this time.But foreclosure is only one of several ways homeowners or investors can lose property. Here are six different ways to lose your home.

• Behind in Mortgage Payments. Generally, quit paying your mortgage and you’ll end up getting past due notices, followed by foreclosure proceedings notices and then a visit from the sheriff’s office to help you remove all your property from the household. The increase in foreclosures comes as no surprise. An increase in delinquencies is due to a number of factors: the seasoning of the loan portfolio, the increased shares of the portfolio that are ARMs and sub-prime mortgages, as well as the elevated level of energy prices, rising interest rates, rising property taxes and insurance rates.

• The taxman cometh. For homeowners who pay their own taxes — that is, they are not paid through a mortgage service provider — a tax sale could be in their future if they fail to pay taxes on the property. Although most tax sales are through local governments, state and federal revenue agencies can confiscate real estate for not paying taxes. If this happens, it’s not as simple as just paying the back taxes and getting your property back. For some, it includes also paying penalties and interest. It can amount to a lot of money.

• Bankruptcy. Bankruptcy laws have changed. In the past, filing bankruptcy usually gave the homeowner some protection from losing his home to creditors. With the revamped bankruptcy laws passed in 2005, creditors might now have the upper hand now. New law allows for 180 days for the consumer to work out payment plans with the creditor, it does not stop the foreclosure process, which could be a shorter period of time than the payment workout plan.

• Fail to pay other debts besides mortgage. Unless you live in Florida and have a home exemption, creditors can come after you, they are in business for one thing — to make money. Consumers pay interest and fees when they borrow. If the consumer fails to pay off those loans, creditors can go after assets to satisfy the debts. Your house could be one of those assets.

• Fail to pay homeowners’ association fees.If you get into an argument with your homeowners’ association (HOA), withholding the homeowners’ fees paid each month should not be one of your strategies. HOAs can also auction your house to satisfy past-due HOA fees.

• Take part in illegal activity. The American Civil Liberties Union contends that 80 percent of homeowners who have had property forfeited by the federal, state or local government have never been convicted of a crime. To seize property for illicit activity, law enforcement officials only need to have probable cause that the homeowner either used the property in committing a crime or purchased the house through illegally obtained funds.

If you are feeling the pressure of not being able to hold on to your investment, one thing you should’nt do is bury your head in sand. Focus on your options and take action. You can check out more information through my website http://www.richardrecuset.com/ or Call or email me for further consultation.