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How to Sell A House Before Foreclosure Pennsylvania
"Can I Sell My House In Foreclosure?"

How to Sell a House During Foreclosure in Pennsylvania

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What is Foreclosure?

Foreclosure refers to the legal process that banks and other lending institutions initiate when homeowners default on their mortgage payments. It essentially allows the lender to seize the home, kick out the homeowner, and sell the property to repay the outstanding mortgage balance.

In the U.S, for example, there were approximately 200,000 foreclosure filings in 2020 according to a report by ATTOM Data Solutions. This alarming statistic reveals how often homeowners can find themselves in this predicament, showcasing the very real relevance and gravity of foreclosure.

How Do Foreclosure Sales Work in PA?

In Pennsylvania, foreclosure sales typically occur through a county Sheriff’s sale. This is essentially a public auction where the highest bidder can buy the property. Now, this doesn’t happen all of a sudden. There’s a whole process involved before reaching this point.

The pre-foreclosure process in PA commences with the Notice of Default (known as Act 91 notice in Pennsylvania). This is a written notice from the lender, alerting the homeowner about the impending foreclosure since the mortgage payments are in arrears.

If payments are still not made, the lender can file a lawsuit to obtain a court order to foreclose. This leads to the home being scheduled for a Sheriff’s sale.

During the sale, if the property doesn’t sell, the lender will typically purchase back the home, resulting in a bank-owned property or Real Estate Owned (REO) property. Post-sale, if the homeowner still occupies the property sooner or later, they will be evicted.

For Pennsylvania homeowners, understanding this process is crucial to navigating the landscape of foreclosure sales.

Ways to Avoid Foreclosure in PA:

In Pennsylvania, there are several strategies that a homeowner can employ to avoid foreclosure. Here are a few methods:

  • Pay the Missed Payments and Any Fees: This is the most straightforward option. If your financial circumstances improve, you can avoid foreclosure by simply bringing your mortgage payment current, along with any additional fees assessed by the lender.
  • Loan Modification: This involves altering the terms of your mortgage with your lender. You could potentially lower your monthly payments, making it easier to avoid foreclosure.
  • Short Sale: This is when you sell your home for less than what you owe on your mortgage. Your lender must agree to a short sale, and they’ll usually agree if they believe it’s the best way to recoup their money.
  • Deed in Lieu of Foreclosure: In this case, you voluntarily transfer the ownership of your property to the lender to avoid foreclosure proceedings. This usually happens if selling the home isn’t likely to cover the remaining mortgage.

Process to Sell a House in Foreclosure in Pennsylvania:

If foreclosure seems inevitable, selling the property is a practical option. Here’s the step-by-step process:

  • Determine the Property Value: First, establish the market value of your home. You can hire a professional appraiser for this.
  • Set an Asking Price: Based on your home’s value and the urgency of sale, set a realistic asking price that will attract buyers.
  • Notify the Lender: Inform your lender about your intention to sell. They might allow you to conduct a short sale, especially if the sale can cover a significant portion of your outstanding mortgage.
  • Market the Property: List your property on real estate platforms and promote it through various channels.
  • Review Offers: Evaluate the offers that arrive. Keep in mind the amount you owe on your mortgage during this stage.
  • Negotiate the Offers: Leverage any competitive interest to negotiate the best possible sale price.
  • Close the Sale: Work with a real estate attorney or agent to finalize the sale and oversee the transfer of ownership.

Options for Selling a House in Foreclosure in PA:

There are multiple ways to sell a property in foreclosure. To decide the best approach for you, it’s essential to understand the possibilities:

  • List With an Agent: Real estate agents have an extensive network and expertise in selling properties. However, agent fees can be high, and the process can take a while.
  • For Sale By Owner (FSBO): This do-it-yourself approach allows you to avoid agent commissions. But be prepared for the responsibility of handling every aspect of the sale.
  • Cash Home Buyer: Companies like “Yes I Pay Cash” will buy your house as-is, quickly and for cash. This option is excellent if you need to move fast.

Alternatives to Selling a House in Foreclosure in PA

When faced with the overwhelming prospect of selling a house in foreclosure in Pennsylvania, it’s crucial to be aware of alternative options that could potentially alleviate the burdensome situation. Here are some alternatives that homeowners can consider:

Catching Up Missed Payments

One possible approach is catching up on missed mortgage payments. Lenders might be willing to work out a plan with homeowners to help them catch up on their overdue payments, thereby avoiding foreclosure. This could involve creating a revised payment schedule that allows the homeowner to repay the missed payments over a certain period while continuing with regular mortgage payments.

Loan Modification

Another viable option for homeowners facing foreclosure in Pennsylvania is seeking a loan modification. This process involves negotiating with the lender to alter the terms of the loan, making it more manageable for the homeowner. Loan modification could include reducing the interest rate, extending the loan term, or even modifying the loan type to make it more affordable for the homeowner.

Deed in Lieu of Foreclosure

For homeowners who are unable to catch up on missed payments or qualify for a loan modification, a deed in lieu of foreclosure is an alternative to consider. In this scenario, the homeowner voluntarily transfers the property back to the lender to avoid the foreclosure process. While this might impact the homeowner’s credit score, it can be a preferable option compared to the detrimental effects of a foreclosure.

Short Sale

A short sale is yet another alternative for homeowners struggling to sell a house in foreclosure in Pennsylvania. This involves selling the property for less than the outstanding mortgage balance. The lender must approve the sale, understanding that the proceeds will not fully cover the remaining mortgage amount. While this can be a complex process, it allows homeowners to avoid the damaging consequences of a foreclosure and potentially reduce the impact on their credit score.

couple in foreclosure - Yes I Pay Cash

Avoid Foreclosure – Sell Your House For Cash Today!

Here at Yes I Pay Cash, we make the process of selling a foreclosed home a breeze. We understand the stress homeowners in foreclosure face, and our aim is to offer a simple, hassle-free solution.

We purchase properties in any condition, and we mean ANY. No need to worry about costly repairs or renovations – let us handle that. Our process is quick and efficient, meaning you can move on faster from this tough chapter in your life.

Being cash buyers, we’re not subject to the delays of traditional financing, so you get your money faster. Plus, we handle all the paperwork, making your life simpler.

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Sell My House Before Foreclosure PA - Common Questions

Can I stay in the house after a foreclosure sale in PA?

After the foreclosure sale in Pennsylvania, the new owner may have to initiate a formal eviction process to remove you from the property.

Can a foreclosure be reversed in PA?

Yes, it’s possible. If you can prove that the mortgage lender unlawfully initiated the foreclosure, the process could be reversed.

How long does foreclosure take in PA?

The foreclosure process in Pennsylvania typically takes around 90 days, but it can extend based on the situation.

Can I avoid foreclosure in PA if I’ve already received a Notice of Default?

Yes, even if you’ve received a Notice of Default, there’s still time to avoid foreclosure by paying off what you owe, including all fees and costs that the lender has incurred.

What happens to my credit score after foreclosure in PA?

A foreclosure can significantly drop your credit score, and it may stay on your credit report for as long as seven years.

sell house in foreclosure

Final Thoughts: Selling a House in Foreclosure in Pennsylvania

Selling a house in foreclosure in Pennsylvania, while stressful, offers multiple paths to mitigate the situation. By understanding foreclosure, the sale process, and the options available, homeowners can navigate this testing phase with confidence and make decisions suited to their unique circumstances.

We can help you sell your house during foreclosure in Philadelphia, Allentown, or Reading PA. Additionally, we can help you sell your foreclosure home in York, Harrisburg, and Lancaster.

Disclaimer: This article is for informational purposes only and should not be construed as legal or financial advice. Please consult with professionals for advice specific to your situation.

If you need to sell your house fast in Pennsylvania even in foreclosure contact Yes I Pay Cash. We buy houses in foreclosure throughout central Pennsylvania. You can reach us at (717) 353-3222 to get a fair cash offer or fill out the form below.

Helpful Resources to Avoid Foreclosure in Pennsylvania

PA Mortgage Assistance

HUD Approved Counselors

Get A Cash Offer On Your House In Foreclosure

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Tariq Thomas

Tariq Thomas, has been a full-time real estate investor since 2002 and has personally flipped hundreds of properties. He is the founder and owner of Yes I Pay Cash - We Buy Houses. Tariq's goal is to help home sellers find the best solution for their real estate needs, whether that's selling their home quickly, getting top dollar, or avoiding the hassle of a traditional home sale.

Additional Resources to Sell Any House in Pennsylvania