Can I Sell My Home If It’s In Foreclosure in Tennessee?

Foreclosure occurs when a homeowner is unable to make their mortgage payments on time and has no way to catch up on the missed payments. Because a mortgage is a legal agreement between you and your lender, once you’ve defaulted on the loan, the lender can auction off the property to cover any outstanding debts, leaving you homeless and with terrible credit.

No one wants to receive a notice of foreclosure and yet, in a nationwide study, nearly 1 million Americans were afraid of losing their homes (U.S. Census Bureau Household Pulse Survey, fielded from July 27 to Aug. 8, 2022). And foreclosure can occur from a number of reasons, including:

• Job loss and loss of income
• Divorce or death of a spouse or partner
• Mounting debt, including medical and credit cards
• Moving without being able to sell the home
• Natural disaster

Premise Home Solutions is a local company operating in Tennessee that has built their business by buying distressed houses and properties in the area for cash. They promise competitive cash offers without the hassle of dealing with real estate agents, title companies, traditional bank financing, and more!

What is Foreclosure?

Let’s say you or your spouse recently lost your job. You still have the same bills to pay but unfortunately you don’t have the money to cover your expenses, including your mortgage payment. What happens now? Even if you find another job the amount of debt you’ve accrued during that time might be too large for you to pay off in a reasonable amount of time. When this happens, the bank starts the process of foreclosure.

How Long Do You Have To Get Out of Your House After Foreclosure?

The steps for foreclosure in most states are missed payments, public notice, foreclosure, auction, and eviction, but the amount of time for each step varies based on state. You could have anywhere from 120 days to nine months before the bank can foreclose using either a judicial or non-judicial foreclosure. During this time, your lender will reach out to you by phone, mail, and email to let you know about the process.

The Different Types of Foreclosure

There are two different types of foreclosure you may experience:  nonjudicial foreclosure or judicial foreclosure.

What Is Non-Judicial Foreclosure? 

A non-judicial foreclosure is the fastest and cheapest way for a lender to foreclose on your Tennessee property. It does not require taking you, the homeowner, to court and can be completed according to state statutes. In the case of non-judicial foreclosure, your lender repossesses your home to sell it and recover whatever debt is owed using what’s called a “power-of-sale” clause in the deed of trust. Not every state allows for this option but, if yours does, the lender will generally choose it to avoid any court costs. Tennessee Foreclosure Laws and Procedures

What Is Judicial Foreclosure?

In states that require judicial foreclosure, your lender must file a lawsuit asking the court to issue an order to allow for the sale of the home. The lender must provide you with this letter. Whether you agree or not, you must respond to the letter or the lender will automatically win the case and be allowed to put your home up for a foreclosure sale. When the house is sold, you are still required to pay the difference between what you still owe on the mortgage and the amount the house sold for. 

Auctions are not like regular home sales and generally the house is not sold for market value. This means that even if your house is in great shape and worth a lot more than what is left on your mortgage, you may still find yourself owing tens of thousands (if not hundreds of thousands) of dollars for a house you no longer own! This is called a deficiency judgment. It’s an expensive and long process for lenders to take to try and recoup their debt, which is why most prefer a non-judicial foreclosure.

How to Sell Your House Before Foreclosure in Tennessee

Let’s break down a few ways you can sell your house, depending on your time frame and situation:

Hire A Real Estate Agent

When considering selling a house or property, many Americans typically start by contacting a local real estate agent. However, in challenging situations like foreclosure, this may not always be the best option. While a skilled agent can list your property on the MLS, prepare it for showings, and facilitate the closing process, a significant portion of your sale proceeds will go towards their commission. For individuals already burdened with debt and aiming to repay their lender in full, parting with 3% to 6% of the final sale price can be a substantial sacrifice.

Plus, there’s the additional fear of not knowing when your house will actually close. Realtors may promise a lot, but at the end of the day you’ll still need to find the right buyer and wait 30+ days for a traditional close. For some homeowners who are facing auction and eviction, even waiting one month might be too long.

Short Sale

If you find yourself in a situation where you owe more on your property than its current market value, your real estate agent may recommend a short sale. A short sale becomes necessary when the outstanding mortgage balance on your property exceeds its market value. For instance, if your mortgage balance is $175,000, but the property is valued at $125,000 in the current market, a short sale is typically the solution. However, it is important to note that while a short sale may seem like a viable option, it is not a quick or simple process.

Initially, you will need to seek approval from your lender to proceed with a short sale. To qualify for a short sale, you must demonstrate financial hardship with supporting documentation such as W-2s, medical bills, etc. In cases of income loss, the lender will expect proof that the situation is enduring and unlikely to improve. If the lender grants approval for the short sale, you will need to engage the services of a real estate agent and attorney experienced in handling short sales. It is important to note that their fees will remain consistent with those of a traditional home sale.

If your foreclosure hasn’t dragged on for too long and you’ve maintained contact with your lender, it’s likely that they will approve the short sale. This allows them to avoid the time and expense of trying to foreclose on your property, while still recouping some of the loss from the missed mortgage payments. But for the regular American homeowner, the short sale will follow them for the next 5 to 7 years. 

You may have sold the house and been able to pay off some of your debt, but the short sale can damage your credit the same as if you had declared bankruptcy. The credit unions include the delinquency on your mortgage(s) to your lenders and the short sale on their records, making it nearly impossible for previous homeowners to get a credit card, buy a car, or move into a new house or property for the same amount of time as a bankruptcy.

Sell Your House AS-IS to A Cash Buyer

If you’re under a strict time restraint to sell your house before a foreclosure progresses to auction and eviction, you do have options! You can try to sell your property with a real estate agent, work with your lender to complete a short sale, or – best of all – turn to a trusted and reliable cash investor to help you with your situation.

Some of the benefits of selling to a direct cash investor include:

• A quick and pain-free closing process.
• Avoid paying any commissions or fees.
• You won’t have to worry about marketing your house and waiting for a buyer.
• No need to clean-up or complete any repairs!

When you sell your home as-is to a direct cash buyer likePremise Home Solutions, you not only can avoid losing your home to an auction, but you also may be able to sell the property for enough money to get out of financial debt. Moving on with your life without the burden of a monthly mortgage payment and debt hanging over your head is one of the best gifts you can give yourself!

Can You Stop Foreclosure Once it Starts?

Pay Off Your Loan & Fees

Facing a challenging financial situation? It’s time to take control of your debt and finances. Consider liquidating assets, seek financial assistance from friends or family, or consulting with a professional to restructure your budget. In doing some or all of the above items, you could have your loan reinstated by the bank stopping the foreclosure. By taking action now, you can work towards paying off debt, preventing foreclosure, and regaining financial stability. Get in touch with a financial expert today to start your journey towards a debt-free life. Contact Premise Home Solutions at 423-331-6110 for personalized assistance.

Declare Bankruptcy 

As a last resort, bankruptcy may help you stop the foreclosure of your home but it comes with a high cost. The bankruptcy process is complex and will require a lawyer that specializes in bankruptcy law. If the court approves your petition, you will be entered into a government-approved credit counseling program and the bankruptcy will be reported on your credit report for 7 years. A bankruptcy affects all areas of your life, including when you try to purchase a car, apply for a credit card or bank account, and can disqualify you from future rentals.

The Homeowner Affordability and Stability Plan (HASP) 

If your debt is higher than your income, you may be eligible for the Homeowner Affordability & Stability Plan (HASP). HASP is a loan modification program targeted at borrowers who are at risk of foreclosure due to insufficient income. This government program was designed to help homeowners in the United States restructure their monthly payments to fit a limited budget. Apply for the program here to see if you qualify.

Sell Your House Fast to a Cash Buyer 

Are you looking to sell your house quickly without waiting 30+ days for a traditional close? Worried about the impact of a short sale on your credit? Seeking to settle your debts at once and get the bank off your back promptly? Consider partnering with a reputable direct home buyer and cash investor in Tennessee. A trusted company with available cash, we specialize in purchasing homes as-is. By working with us, you can bypass the prolonged procedures of foreclosure, eviction, and auction, and protect your credit. Contact Premise Home Solutions at 423-331-6110 today for a swift and hassle-free selling experience!

You may not get full market value for your house or property when you sell to a trusted cash investor, but the timeliness of a fast closing, and the lack of fees, required inspections, and commissions often balance this out at close. Best of all, because an investor can close fast, you can often close before the bank is able to auction off your property! This means you can sell the property for the amount that benefits you versus the pennies to the dollar price the bank will often try to sell your house for just to get it off the books.

We Buy Houses in Foreclosure & Pre-foreclosure – Get Your Offer Today!

Does the idea of finally walking away from a property without the storm cloud of foreclosure hanging over your head? Contact a real professional at Premise Home Solutions to find out more and get a fair cash offer for your property today.