Here are some of the most common myths about foreclosures.

Myth 1: The bank wants your house

Truth: The bank almost never wants your house, they want the money they lent you paid back with interest. Banks are in the business of lending money, not owning real estate. In fact, banks usually hate going through the foreclosure process and will bend over backwards to work with homeowners in avoiding a foreclosure.

Myth 2: The bank will not take my payments, I can do nothing else

Truth: At some point many banks say if you do not pay all of your arrears in full they will not accept a partial payment. Maybe a month later you get that figure together only to find the bank sends it back because another month has gone by and now the “all or nothing” requirement has grown. Do not fear! If you and the bank can not get together on a solution for stopping foreclosure a mortgage negotiation professional can set up a plan for you to pay just a portion of the arrears now if along with the partial mortgage arrears payments you set a plan to pay future current payments and catch up on the remaining arrears over time, sometimes months, sometimes the life of the balance of the loan or extending the loan.

Myth 3: I received a foreclosure notice; I have to move out now

Truth: Currently in Colorado the foreclosure process is taking about 6 months to 1 year sometimes longer. Following a foreclosure you must go through an eviction hearing. Eventually you will be physically removed. I’m not suggesting you hold out until the end, but making sure you know you get to stay if you want to exhaust all your options. Time can be on your side if you take action early and don’t waste the many opportunities for stopping the foreclosure.

Myth 4: I’m in foreclosure, no bank will refinance me out of this foreclosure

Truth: If you have enough equity in your home, typically 60%-70%, specialty lenders will refinance the house to pay off the old bank and stop the foreclosure.

Myth 5: On the foreclosure auction day everyone in the world is going to invade my house

Truth: The foreclosure sale in Summit County is held on the courthouse steps in Breckenridge.

Myth: A chapter 7 bankruptcy will stop my foreclosure and save the house

Truth: A chapter 7 bankruptcy will stop the home foreclosure only on a temporary basis. Eventually you need to do something else to keep the house in the long run if you are facing foreclosure. Make sure to seek a qualified professional for your options and consequences.

Myth 6: I have to do everything I can to save the house and continue to live in it

Truth: Sometimes people need to move on if they can no longer afford the payments. Otherwise they could find themselves back in the same situation in the future…

Myth 7: I’m getting foreclosed on and I’m going to go to jail

Truth: You may lose your house, but you don’t go to jail for not paying the mortgage.

Myth 8: No one can help me in stopping my home foreclosure

Truth: There are many professionals that can help you avoid foreclosure. You do have several options and alternatives! If you would like the list of some of the options that might work for you, just drop me an email.

This article is for information purposes only. Please seek professional advice for your personal circumstances. Cynthia has been the “The Foreclosure Broker” for 26 Years in Summit County. Give her a call or drop her an email with your questions. cynthia@cynthiagoda.com 970-468-0404.