Foreclosure properties in Ohio have been on the rise. Banks have different ways of reaching a foreclosure but the end game is always the same. The owner looses their home when their lender must foreclose on the home. In most cases the house has sat vacant and damages have resulted from the utilities being off and vandals breaking in to steal copper water lines, appliances or any other valuable component of the house. Banks would rather avoid foreclosing on a home. They would much rather help the home owner stay in the home and get caught up on their payments through one of the many loan modification programs or to take the property back through a friendly agreement like a deed-in-lieu or to get rid of the house by a short sale.

The Ohio foreclosure process can be stopped if the seller wishes to put some time into working with their bank or getting help from a realtor who deals in short sales. A good place for a property owner to start is a forbearance or loan modification. In situations where the homeowner has had a temporary setback a forbearance could be a workable solution to help them become current with their payments. A forbearance is when the bank does not attempt to collect an unpaid balance. What they often do is add in on to the end of the mortgage or build it into the monthly payment and allow the owner to get caught up. Another possibility for distressed owners who have a more permanent decline in income is a loan modificaton. The bank will often times decrease the percentage rate of the mortgage thus decreasing the monthly obligation for the homeowner who has experienced a decline in monthly income. The problem with a modification is the owner must qualify for the new payment based on their new income. Not everyone will be able to take advantage of these programs because their financial situation has deteriorated beyond the possibility of recovering.

A final choice before foreclosure is a short sale. A short sale also known as a pre-foreclosure is when the homeowner must sell their home and they owe more than the home is worth. A bank would much rather work with the homeowner on a short sale then let the property fall into foreclosure. While there is really no win win situation it helps both parties because the bank is able to liquidate the property and take the loss without all the legal costs and damages to the property sitting unoccupied and the seller is able to walk away from the property and preserve their credit. In the past the seller would get stuck with a tax loss payment but the government has temporarily stopped tax payments on the loss. This means a property owner can short sale their property and walk away without any further financial obligation. They are exempt from paying money at the settlement and can get on with their lives. Make sure to talk with your tax advisor since there are some exceptions to the tax payment.

I hope this article gives you some guidance in your financial predicament with your home. You don't need to give up or give in. There is usually a solution to keep your home out of Ohio foreclosure.

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