Foreclosure is not a complicated legal process but it can be confusing to the average homeowner struck in it. The exact legal process varies from state to state and county to county, however, the overall process is very similar.
A homeowner gets behind on his mortgage and a Notice of Default ("NOD") is issued by a legal service processor, such as certified mail, sheriff, or public notice. The defendant has a period to reply and if the default is not cured, the entire amount of the mortgage or deed of trust is due and payable. The time involved in this part of the process varies by the type of lien in place on the property.
A deed of trust may not require a judicial proceeding, or actually going to court since the trust deed stipulates specifically what action the lender is allowed to take to sell the property or have a new deed issued in his name. If this happens, he can next evict the homeowner essentially just like a rental tenant. In some states a judicial proceeding is required, in which case, the lender must petition the court to issue a final judgment amount for the mortgage deficiency and then set a date for the sale of the home.
Under no circumstances should the homeowner try to avoid service of the lis pendens or any legal notice from the court or the trustee of the lender. It may seem like not accepting these legal documents will stall the foreclosure, but quite the contrary, the legal notice will simply be put in the local newspaper and have the same effect. It is not an excuse that "I didn't know about it" that some people tell the sheriff as they are being evicted. The homeowner's best option is to accept the legal notice and read it carefully. It will completely detail what timeframe is prescribed by law and what the homeowner has to do to respond or how to cure the amount owed.
The NOD will stipulate that the loan is immediately due and payable in full.
While that is true, in the real world, it is not the case that the homeowner must pay off the entire loan immediately. The homeowner has a "cure" period or a certain amount of days to fix the problem by negotiating a settlement with the lender, such as a loan modification or reinstatement of the existing loan, or even possible refinancing (unlikely). If the lender is uncooperative, it may be because the lender knows there is equity in the home and he can take it back and sell it for a profit.
In summary, the legal process of foreclosure is not complicated as legal processes go. However, it is a process that is very time sensitive and any procrastination on the homeowner's part will definitely be very harmful. It is recommended that the homeowner become familiar with the legal documents he is served and read his loan agreement to see what it says will happen in the event of a default. If there still are questions, he should become more informed about the entire legal process in his state and focus on resolving the problem that got him into foreclosure in the first place.
About Author:
Dave Dinkel is the author of "32 Ways to Quickly Stop Foreclosure" and has helped thousands of foreclosure victims for nearly 33 years. If you are facing foreclosure, visit StopMyForeclosureMess.com for guaranteed solutions.
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Frequently Asked Questions
Bankruptcy erasing evictions from credit report.
By: Leilauni | 15-07-2008
Will filing bankruptcy take an eviction off your credit report?
SINGLE PARENT Facing Foreclosure
By: EternalManJaguar | 15-07-2008
I am a single father (mother-also) with 2 minor children who's mother passed away. I am self employed and own 2 businesses that have been severly damaged by the recession. My mortgage company would not work with me and I have a substantial amount of equity. I am past the Notice Of Default being filed and am facing foreclosure soon. Other than this problem I have no debt, I own all my vehicles and only have debit cards.
I am planning to file chapter 13 bankruptcy soon but the mortgage is the only reason. I have some inheritance coming that has been tied up but it will not be available in time to save the foreclosure. If the foreclosure could be postponed only about 60 days I could cure the default in full.
Is there any other option? Because of my work and this credit problem I cannot borrow enough to save the house. I have no living relatives, just adult children in addition to the minor children.
I am feeling desperate and do not really want to file bankruptcy. HELP?
Lynn
Mediator delay tactic.
By: Nic | 14-07-2008
Is there a Florida law that limits the amount of time a mediator can delay a foreclosure.
File bankruptcy after or before foreclosure?
By: Dani | 08-07-2008
I no longer live at my condo because Im afraid of the eviction on the foreclosure. So the condo stays empty at this time. Also my home has been on the market for "short sale" for quite a while now and haven't had any luck with the sale yet. But I am very close of going towards foreclosure any day now. I am considering of filing Bankruptcy using chapter 7 & 13 cause I have many other bills I am in debt for. Should I wait until the foreclosure proceeds then file for bankruptcy? I wish I can do sooner but because of financial situation, I am unable to file anything right now but hoping to file within 3-4 months when i get the money to do so. Please give me some advice on what my options are at this point. Thanks.
Renter's rights during foreclosure
By: Jcgal | 05-07-2008
What are renter's rights in michigan when property is being foreclosed upon?
Foreclosure bailout for teacher with 15 years service
By: carol brady | 03-07-2008
Is there anyone out there who will help a SINGLE MOTHER AND DEDICATED teacher save her home when she has bad credit? Is there anyone who believes in people and their potential to work through this time? Can they contact me. I am tired of being taken advantaged of.
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