Has your house suffered a price decline? Are the interest rates rising? Suppose you answer YES to both of these questions. In that case, your house may likely go into foreclosure, as these are the most common causes of foreclosure after family issues like divorce, death, disease, and denial.
However, before a foreclosure process starts, the house must first go into a Pre-foreclosure Process. The pre-foreclosure is the initial stage in a foreclosure process, and it is structured in a way that allows homeowners to make arrangements so they can stay in their homes before all the legal stuff begins to happen. While the process is in this stage, homeowners are given viable options to get back on track.
While you may agree to some of the options you have in the Pre-foreclosure Process, it is vital to understand how foreclosures can impact your credit score.
How Does Foreclosure Affect My Credit Score?
While foreclosure does have a negative impact on your credit score, your credit is initially affected by the missing payments on your mortgage loan, which is even before the foreclosure process is started. The report will be reflected on your credit score 2-3 months after the lender has started the foreclosure procedure.
A foreclosure can significantly reduce your score affecting your ability to be eligible for new credits. A foreclosure report remains on your credit for as long as seven years after the first missed payment is recorded, and is removed afterwards.
The severity with which a foreclosure can impact your score varies as it entirely depends on what your current score is, your credit history, and the number of mortgages being foreclosed. Nevertheless, restoring your credit is feasible according to credit experts.
How To Get Your Credit Score Back Up
Because nobody wants to have a bad score that can only limit anyone’s ability to get new credits, you must know what you can do to have your credit score restored. Rebuilding your credit involves time, patience, and commitment, and here are some of the things you can do:
Determine the cause of the foreclosure: For this, you may want to take a look at your spending history to analyze certain things like unnecessary purchases, unexpected expenses. Identifying where you could have overspent is key to better understand what led to foreclosure to work around that.
Make your bill payments on or before their due date: Processing your payments on time plays a key role in how your credit score is calculated. Payments being made on time have the potential to prevent a foreclosure. Reviewing Your Credit Utilization Ratio and Seeking Professional Advice are among the most common factors to consider when restoring your credit.
Actionable Ways To Successfully Deal With Foreclosure
Suppose the foreclosure has already been arranged to be initiated. In that case, the first thing you should consider is filing for bankruptcy. Generally, filing for bankruptcy is done when facing unemployment, expensive medical bills, significantly prolonged credits, and things of this nature.
The purpose of taking this action is to legally demonstrate your inability to continue to make payments to any financial institution you owe money to. However, it is advised that you seek professional assistance before you make your decision to ensure it is, indeed, your best choice.
Seeking professional help to get adequate counsel will help you better understand your choices and rights. Lowering as much as possible any additional financial stress is just as important. But selling your house to House Buyers OKC can potentially be the solution.
The One Thing You Can Do When Facing Foreclosure
Going through foreclosure? One of the easiest ways to deal with this is by letting home buyers in OKC handle it for you. We buy houses in Oklahoma no matter what you are facing. The process with House Buyers OKC process is fast and reliable.
Selling your house to home buyers in OKC is a hassle-free process as you are not required to do home repairs or even clean the house. Plus, you get to choose the closing date. Learn about how we buy houses in Oklahoma in four easy steps.
The process can close in as little as only ten days, and we take care of any closing fees associated with the sale.