There are many unfortunate events that can lead to the financial nightmare of a home foreclosure. Although this is a very difficult and unsettling situation to be in, there are options and steps that can be taken to help secure a grasp on the situation.
Here are the top tips to consider when dealing with a foreclosure.
Foreclosures Take Time
The entire foreclosure process can take anywhere from two to 12 months, depending on how fast your lender acts and where you live. Some states allow a non-judicial process that’s faster, while others require time-consuming judicial proceedings.
Once you miss at least one mortgage payment, there are many steps leading up to an actual foreclosure sale that includes demand letters, notices of default, a recorded notice of foreclosure, publication of the debt, and the scheduling of a foreclosure auction.
Because the foreclosure process may allow you to remain in your home for up to a year, you must be proactive in establishing a solid plan.
Read The Fine Print
If your lender has begun sending correspondence letters, be sure to review all of the fine print to understand what your options are.
Also, be sure to review your mortgage documents, which should outline what steps your lender can take. For instance, is there a “power of sale” clause that authorizes the sale of your home to pay off a mortgage after you miss payments?
Every state requires different foreclosure laws, be sure to understand how that might affect your timeline. Do you have a grace period, or “right of redemption?” These specifics found in your mortgage documents may help to highlight what options you have from the very beginning of the foreclosure process.
There are alternatives to foreclosure that your lender might accept.
The most attractive option that’ll allow you to keep your home is a loan modification that reduces your monthly payment.
A modification can entail lowering the interest rate, changing a loan from an adjustable rate to a fixed rate, extending the term of a loan, or eliminating past-due balances. Another option, forbearance, can temporarily suspend payments, though the amount will likely be tacked on to the end of the loan.
Contact The Right Legal Counsel For Your Situation
Having the right legal advice when dealing with a foreclosure process is an imperative step in protecting yourself, your credit, and your investments.
We work with homeowners, business owners, lenders, junior lienholders and real estate professionals. Our goal is to help you find ways to avoid foreclosure and lasting damage to your credit.