Mortgage assistance
Mortgage assistance belongs with your servicer and a HUD-approved housing counselor.
Seller guide
Short Sales and Foreclosure in the Bay Area: Know Your Options
Trouble making mortgage payments does not automatically mean you need a short sale or will lose your home.
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Start with where you actually stand
Trouble making mortgage payments does not automatically mean you need a short sale or will lose your home. Start with what the property could sell for, what you owe and any deadlines already in place.
If you have received a foreclosure notice or a scheduled sale date, contact your mortgage servicer and a California foreclosure attorney promptly. Do not wait for a home valuation before addressing a legal deadline.
Discuss a possible home sale with Kate
Payment trouble and negative equity are different problems
Equity is the difference between the home's value and the debt secured against it. Having equity does not necessarily mean you can afford the monthly payment. It also does not tell you what you would keep after selling costs.
To evaluate a sale, compare a realistic sale-price estimate with current loan payoffs, other liens and selling expenses. A regular sale may be possible if the available funds cover those obligations. Missed payments alone do not make the transaction a short sale.
Compare the paths before choosing one
These are possibilities to review, not a recommendation or a complete list.
Forbearance pauses or reduces payments temporarily. It does not erase the amount owed. Before moving out to rent the property, ask your servicer whether the move would affect eligibility for mortgage assistance.
California DRE alternatives · CFPB mortgage options · CFPB forbearance guidance · FTC occupancy guidance
Possible paths and what to check
| Possible path | What needs to be checked |
|---|---|
| Keep the home | Ask your servicer about a repayment plan, forbearance or loan modification. Availability depends on your loan and circumstances. |
| Sell through a regular sale | Estimate whether the sale can cover loan payoffs, other liens and selling costs. Review timing if foreclosure is already underway. |
| Rent the property | Compare realistic rental income with ownership costs, vacancy, repairs and your own housing costs. Check loan terms, insurance, HOA restrictions and local rental requirements. |
| Request a short sale | If sale proceeds will not cover the mortgage debt, ask whether the lender or servicer will approve accepting less. Approval is not automatic. |
A short sale needs approval, not a promised closing date
A short sale requires the lender or servicer to accept less than the mortgage balance from the sale. Additional loans or liens can require further approvals or arrangements. Finding a buyer does not guarantee approval or closing.
Before agreeing to terms, have a qualified attorney review the approval and any remaining obligations. Ask a tax adviser about possible tax consequences. Do not assume the sale removes every debt or has no effect on your credit.
A listing does not stop foreclosure
Foreclosure is the process through which a lender can have a property sold after a loan default. It is not the same as an owner arranging a regular sale or an approved short sale.
Putting the home on the market does not itself postpone a foreclosure sale. Your servicer may agree to a postponement, but do not assume one has happened. Have an attorney review your notices, deadlines and available legal protections.
Get the right help for each part of the decision
I can help estimate your home's market value and discuss a possible sale.
Free foreclosure-prevention counseling is available through HUD-approved agencies. Be cautious of anyone who guarantees they can stop foreclosure or tells you to sign over the property to save it.
Find HUD-approved mortgage help.
Discuss a possible home sale with Kate.
This is general information, not legal, tax or lending advice. No sale, approval or foreclosure postponement is guaranteed.
Who can help with each question
Legal rights and deadlines
Legal rights and deadlines belong with an attorney.
Tax questions
Tax questions belong with your tax adviser.
The method
The E.P.I.C. Home Selling Strategy
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