Sales of foreclosure homes were up in the fourth quarter of 2011 to account for nearly one in four as opposed to one out of five in the quarter before, reports CNBC Real Estate.
In fact, in all of 2011, about one million homes in the foreclosure process were sold. That number stands to increase as Fannie Mae and Freddie Mac launch a pilot program to sell foreclosure homes.
Lenders have been helped by increased short sales of homes. Short selling a home in Boston may not be a bad idea.
In a short sale, your servicers may allow you to sell the home yourself before it forecloses on the property, agreeing to forgive any shortfall between the sale price and the mortgage balance. This approach avoids a damaging foreclosure entry on your credit report. However, you still may face a tax liability on the amount of debt forgiven.
And supposing you can't do a short sale of a home in Boston, you might consider a deed in lieu of foreclosure.
You voluntarily transfer your property title to the servicers (with the servicer's agreement) in exchange for cancellation of the remainder of your debt. Though you lose the home, a deed in lieu of foreclosure can be less damaging to your credit than a foreclosure. You will lose any equity in the property, and you may face an income tax liability on the amount of debt forgiven. A deed in lieu may not be an option for you if other loans or obligations are secured by the property on your home.
For more information on both of these methods to go around foreclosures, please see the related resources below.