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Time-Sensitive Mortgage Case Scenario
Hello,
My name is Michelle Thompson, and I’m reaching out about a time-sensitive mortgage situation. My home in Denham Springs, LA 70706 has a sheriff’s sale scheduled for November 18, 2026, due to a matured balloon mortgage. My current lender is not willing to offer a modification, so I’m looking to pay off the existing loan in full with a new loan.
A few key facts about my situation:
Payoff amount needed: $110,000
Co-signer: my partner, Ken Williamson, sole owner of K&W Outlaw Gun Works LLC, self-employed since 2017. His credit score is 650+ across all three bureaus, and he carries no loans or credit cards — his only monthly obligation is a rent-to-own payment on his business building.
My own income: self-employed, owner of Crawfish Tactical Solutions, LLC (opened December 2024), with two years of tax returns and bank-reconciled profit & loss statements available for this year.
There is an active foreclosure on my credit reportGiven the approaching sale date, my most important question is: can you realistically close a loan like this before November 18? I understand that may not be possible through a standard process, and I’d appreciate your honest assessment, along with any options — including non-QM programs — that could work given our combined income, credit, and credit history.
I’m available to talk by phone at 225-901-4800 at your earliest convenience. Thank you for your time and consideration.
Have a blessed day,
Michelle Thompson
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2 Replies
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Hello Michelle,
Thank you for reaching out to Gustan Cho Associates and sharing your situation. Facing a sheriff’s sale is difficult, especially when your mortgage term has ended and your lender has not offered an extension or changes.
We are here to review your case and consider all possible financing options. Our team has experience helping borrowers with credit challenges, self-employment, and other unique situations.
Let’s review the timeline together.
Is it possible to close before November 18, 2026?
We cannot guarantee a closing before November 18. The active foreclosure, two self-employed borrowers, and the approaching sheriff’s sale make this deadline challenging.
Still, we are committed to doing everything we can to support you.
Depending on your home’s value, how much you owe on it, and your documents and credit, we can explore non-QM refinancing and other flexible options. Your partner’s credit score over 650 and being self-employed since 2017 are both good signs. Their business income might also help your application, depending on the documents and our review.
I have a few key questions for you:
- What’s the current market value of your house?
- Is the $110k payoff the full amount (i.e., does it include the foreclosure attorney’s fees, accrued interest, and all the other charges)?
- Is this your main home?
- Is there any other mortgage, judgment or lien on the property?
- Would your current mortgagee be open to putting off the sheriff’s sale if we can show a bona fide refinancing effort?
- Is Ken on the title or is he just joining in as a co-borrower?
The amount of equity you have in your home will be an important factor in your refinancing options. I strongly recommend contacting a Louisiana foreclosure or bankruptcy lawyer as soon as possible to discuss legal options to delay the sale scheduled for November 18. Even if we secure financing, we may still need more time for loan approval, a home value check, title work, and closing. I do not want to make promises that could put your home at risk. I am here for you, Michelle, ready to discuss everything, review your finances, look at available programs, and work together to find a solution. Right now, our main focus is to see if refinancing can help postpone the sheriff’s sale. you again for reaching out to Gustan Cho Associates. I look forward to speaking with you and partnering together to find a solution.
Gustan Cho
Managing Director
Gustan Cho Associates
NMLS 873293
Coast 2 Coast Mortgage Lending, LLC
NMLS 376205
https://gustancho.comHere are my thoughts on your mortgage situation and the loan approval issues we need to address immediately.
- The main challenge is the active foreclosure.
- Most regular and non-QM lenders are unlikely to approve a loan when there is an active foreclosure or a recent serious late payment.
- Property equity: If your home’s value is much higher than $110k, a lower loan-to-value ratio could open up special financing options.
- Borrower income: Ken’s strong business background is a plus.
- We will need to review his business commitments to see if he qualifies as a non-occupant co-borrower.
- Since Michelle’s business started in December 2024, we need to check which tax years have been filed and whether bank statements show enough income.
- Closing deadline: With only 18 days between October 31 and November 18, we have very little time to complete all the necessary steps, including disclosures, home value checks, title work, loan approval, funding, and paying off the foreclosure.
Another concern is whether a special lender will agree to refinance a primary home that is in active foreclosure. It is important not to use a business or investor loan to get around a regular mortgage on your main home.
I recommend contacting Michelle right away to confirm the home’s market value and the exact payoff amount. Then, check if her mortgage lender will agree in writing to delay the sheriff’s sale. She should also get independent legal advice from a Louisiana foreclosure lawyer. The foreclosure process in Louisiana moves quickly, and just applying for a refinancing will not stop a sheriff’s sale. Do not set a closing date until we have secured a financing program and confirmed all eligibility requirements and the closing timeline.
gustancho.com
GCA Mortgage | Mortgage Experts With No Overlays
Whether you have gone through bankruptcy, divorce or you are a first-time homebuyer, Gustan Cho Associates are experts in difficult loans
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Michelle, I have several questions that I think we need to get on the phone to discuss. Why are you about to lose the house, and why is it going through foreclosure? Balloon mortgage loans are normally not allowed and/or are rare on owner-occupied primary homes. Is this an investment property or an owner-occupant home? Have you considered filing for bankruptcy to stop the foreclosure?
Thanks for sending over your story. I’ve got several questions, and I think we’d be better off having a phone call to go through them in some detail before we decide how we might go about helping you.
First of all I need to get a better understanding of the circumstances that led to your home going into foreclosure. You noted that you have a balloon mortgage which requires a huge final payment and that your lender won’t refinance or restructure the loan. Were you able to make your monthly payments up until the final payment was due, or were there other issues?
Secondly, is this property your primary residence or an investment? Balloon payment mortgages on owner-occupied property are subject to the relevant federal rules (although there are of course, exceptions). Can you tell us a bit more about your mortgage? When did it come into being? Why did you go for a balloon payment?
Thirdly, have you thought about getting a bankruptcy attorney to look at your case to see if filing would stop or at least delay the foreclosure? It may not be the ideal solution, but the sheriff’s sale is on the 18th of November so you’re in a time crunch. A bankruptcy filing can in some cases, stop a foreclosure temporarily. It may be worth having a Louisiana bankruptcy attorney take a look at your situation. Can you also provide an estimate of the market value of the property, your equity in the property, and whether the $110k payoff figure includes all the foreclosure costs?
Michelle, I’m absolutely going to look at all the options with you, including the non-QM route. We need to be realistic about what we can do prior to the 18th of November. Let’s have a proper go at your circumstances. The earlier we can identify your options, the better we can go about it. Looking forward to talking to you.
God bless,
Gustan Cho
Managing Director/Branch Manager
Gustan Cho Associates
NMLS 873293
Coast 2 Coast Mortgage Lending, LLC
NMLS 376205
https://gustancho.com-
This reply was modified 8 hours, 40 minutes ago by
Gustan Cho.
gustancho.com
GCA Mortgage | Mortgage Experts With No Overlays
Whether you have gone through bankruptcy, divorce or you are a first-time homebuyer, Gustan Cho Associates are experts in difficult loans
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