Inga Modu-Rella
Keller Williams Realty Group

Facing Foreclosure?



Are you or someone you know facing foreclosure?


Welcome to the page that offers information about the options available to homeowners facing foreclosure. If you or anyone you know, is experiencing financial hardship and is unable to keep up with their mortgage payments, you came to the right place!


What is Foreclosure and How to Avoid it?


This real estate market has caused unbearable stress and heartache. Foreclosure can be a devastating financial experience that a family can face and one that many times it could have been avoided.

Do You Know a Homeowner Facing Foreclosure? Here’s A Way Out.

short sale and foreclosure process

Headlines today are filled with stories about homeowners in financial distress—people who face a lender’s foreclosure on their home.

Are you one of  the many Millions of American homeowners who are wondering what they should do?

Like most crises, this one has produced its share of rumors and misinformation. One of the biggest ones is “just let it happen. It’s too emotionally draining, and the government’s loan modifications aren’t helping many people. Well, that’s only partly true.

While government loan modification programs have fallen short of the mark so far, there is another solid, sensible option for homeowners. It’s called a short sale—a sale to a buyer where the seller’s lender agrees to accept less than the full amount owned.

Why not be foreclosed? Why sell short? Well, agents who have closed hundreds of these transactions provide this list of reasons:


  • Avoid the foreclosure stigma – Homeowners will always have to disclose that they had a foreclosure on any mortgage application and (many job applications) that they submit in the future. This can have an adverse affect on their future mortgage rates. Foreclosure is asked about specifically in credit inquiries. There is no seven-year time limit on this item.


  • Protect credit score – Credit scores will be lowered by 300-plus points (per loan) by foreclosure. The impact of a short sale—about half that much.


  • Improve eligibility for a government insured loan – The homeowner will be ineligible for a government insured loan for 5-7 years (only two years in a short sale). A foreclosure is the one credit report item that is almost impossible to have repaired.


  • Avoid a deficiency judgment – Lenders can seek a deficiency judgment against the homeowner and collect any amount they do not recover at sale.


  • Protect employment prospects – Many employers run credit checks on prospective employees. Foreclosure is one of the top items that will put a potential new hire, or even current employment, in jeopardy.
Short sale timelines, while still longer than normal, are shrinking as lenders get their paperwork act together. Short sale pros are closing 70 to 90 percent of the short sales they represent. They know how to negotiate the buyer’s offer effectively with lenders and get the deal closed—so the homeowner can move on with life and recover.
 The options available to homeowners for foreclosure are many, but most homeowners have heard of short sale only. Many may not known or heard of other solutions available to them:


A reinstatement maybe the simplest solution for a foreclosure, however it is often the most difficult. The homeowner may requests the total amount owed to the mortgage company to date to pays it off. This solution does not require the lender's approval and will 'reinstate' a mortgage up to the day before the final foreclosure sale.

Forbearance or Repayment Plan

A forbearance or repayment plan means the homeowner negotiating with the mortgage company to allow them to repay back payments over a period of time. In this case the homeowner makes their current mortgage payment in addition to a portion of the back payments owed.

Mortgage Modification

A mortgage modification means the reduction of one of the following: the interest rate on the loan, the principal balance of the loan or the term of the loan. It could be any combination of the above, which may result in a lower payment to the homeowner and a more affordable mortgage.

Rent the Property

A homeowner who has a mortgage payment low enough that market rent will allow it to cover the mortgage, can convert their property to a rental and use the rental income to pay off.

Deed-in-Lieu of Foreclosure

Also known as a "friendly foreclosure," a deed-in-lieu allows the homeowner to return the property to the lender rather than go through the foreclosure process. Lender approval is required for this option, but homeowner must vacate the property.


Many have considered and promoted bankruptcy as a "foreclosure solution," but this is only true in some states and situations. If the homeowner has non-mortgage debts that cause a shortfall of paying their mortgage payments, a personal bankruptcy may be a viable solution and will help eliminate those debts.


If a homeowner has sufficient equity in their property and their credit is still in good standing, he or she may be able to refinance their mortgage.

Servicemembers Civil Relief Act (military personnel only)

If a member of the military is experiencing financial distress due to deployment, and that person can show that debt was undertaken prior to deployment, they may qualify for relief under the Servicemembers Civil Relief Act. You will have to find an attorney, a member of The American Bar Association network, who can assist you in qualifying for this relief.

Sell the Property

Homeowners with sufficient equity can list their property for sale with a real estate agent that understands the foreclosure process in their area.

Short Sale

If a homeowner owes more on their property than what it’s currently worth, then they can hire a qualified real estate agent to market and sell their property through the negotiation of a short sale with their lender. This typically requires the property to be on the market for at least 3 months and the homeowner must have a financial hardship to qualify. 


Hardship means a material change in the financial situation of the homeowner between the date of the home purchase and the date of the short sale negotiation. Acceptable hardships include: mortgage payment increase, job loss, divorce, excessive debt, forced or unplanned relocation, and others.

Contact a  foreclosure consultant who can offer real estate solutions to problems if you are facing foreclosure.  Whatever your goals are, there maybe ways to help you. As your foreclosure consultant, Inga can arrange for a sale of your home, allowing you to preserve your credit, your reputation, and your day-to-day affairs. If Inga can’t help, then she can save you lots of time and stress by referring you to professionals she partnered with, who can assist you in your unique situation. Please take that first step of putting yourself back in charge of your life. Contact Inga for additional information or make time for a personal consultation to get you started on the path to recovery.


Are Foreclosures Increasing or Decreasing?


Recently, there has been a lot of talk about the size of the foreclosure inventory in the nation. There has been some speculation that distressed property inventories are about to skyrocket. Today, we want to reveal what is actually taking place in this segment of the housing market.

CoreLogic, in their most recent National Foreclosure Report, reported that foreclosure inventory has decreased by 23.2% since this time last year. The report also showed that foreclosure inventory has decreased in 49 of the 50 states and that 45 states have posted a year-over-year, double-digit decline (see chart below).

Are Foreclosures Increasing or Decreasing? | Simplifying The Market

Bottom Line

Though foreclosures do remain in the market, the number is dramatically decreasing. The fact that mortgage delinquency rates are also decreasing means the worst of the foreclosure crisis is in the rearview mirror.

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Inga Modu-Rella

Keller Williams Realty Group