You may be having financial troubles with your house because your adjustable-rate mortgage has reset to a rate you can’t afford, or you’ve experienced a major financial setback such as losing your job. Foreclosure might seem like the only option.

However, before accepting the seemingly inevitable, take a step back. If you sell your house quickly, you will be able to avoid foreclosure.

This isn’t easy. The foreclosure process won’t just stop simply because you are trying to sell your house. You also need to keep in mind that with the real estate market in such a slump, this may be quite a challenge. A house can sit on the market from 6 months to a year without any real offers. So how do you increase your chances of selling your house quickly to avoid foreclosure?

1.  Price your home right

  • You may have bought your home for thousands more than what similar homes are selling for in your neighbourhood at the moment. Unfortunately you have only two options here:
    • Hold out for the highest price to recover the money you invested which most likely will end in foreclosure
    • Avoid the seven-year black mark that foreclosure will leave on your credit report by pricing your home aggressively. Pricing your home aggressively means giving a low price to the house.
  • Think like a buyer would.
    • Buyers are not interested in paying premium prices for a home just because that’s what you owe.
    • Buyers will focus on properties whose sellers seem realistic about pricing
    • Buyers will be interested in getting a bargain (Tip: When a home is slightly underpriced, it seems like a bargain. You’ll attract more buyers and your change of getting a qualified offer increases significantly.)
  • You want to appear within the price range potential buyers are looking for. If you don’t, your house will sit on the market longer than it should. The ideal would be to research the most recently sold similar homes in your neighbourhood. Work out the average price the houses sold for (not the listing price) and subtract 10% from that for your listing price.

2.  Market your house

  • There are many places you can advertise your house on the Internet, often for free. More than 80% of home buyers start their search for a home on the Web.
  • Take many pictures. The more photos you upload, the more time potential buyers will spend looking at your advertisement and the more likely they will be to come and see your home.
  • Sell your home “as is.” When you are facing foreclosure, you do not have money for major repairs. You can do inexpensive repairs that make a major cosmetic difference. Focus on things that are cheap to fix but that could create a negative impression for your buyer.
  • Just because you’re selling your home “as is” does not mean you can leave it in its current condition. It needs to be immaculate every time a buyer visits it. Spend time cleaning it up, decluttering each room and making it as presentable as possible. Nothing puts a buyer off more quickly than piles, messes and odors.

3.  Contact a professional investment company who will buy your home exactly as it is for cash. These investors are in the business of fixing up less than perfect homes and reselling them or renting them. You can expect a quick closure. This is a situation where everybody wins.

 

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