Not many people know what all a foreclosure entails and what goes into one. If you are in a situation where foreclosure may be on your plate soon, you will want and need to know what to expect. If you are faced with this option it is important that you know what to expect through the process.
Missed Payments
Foreclosure begins when mortgage payments begin getting missed. Likely it takes a few months of missed payments before foreclosure is brought into the picture. Regardless of the circumstances of the missed payments, if one begins missing payments is what starts the process of foreclosure.
Public Notice
Each mortgage agreement can be different so depending on what was agreed upon is when the second stage comes in. Between three and six months of delinquent, missed, payments, it will be recorded through the county. One will be notified via mail, or notice that all payments must be brought to date as well as additional taxes and late fees.
Pre-Foreclosure
This is a time period that is offered to the current homeowners to become current on payments or create an agreement with lenders that is mutually beneficial. Foreclosures can be a long and expensive process and lenders generally prefer to avoid this. If full payment is made, the process will come to an end, however, if payments are not brought to full the property will be prepared for sale.
Preparation for Sale or Auction
An opening bid is calculated for the home. This price is going to be based on whatever the remaining loan balance is, any liens or unpaid taxes in addition to the cost of the sale. From there, the property will go to the highest bidder. After the property is sold, the current tenant has only 3 days to move out before the new owner begins the eviction process.
A foreclosure can be a long process, especially if the property doesn’t sell at auction. If the property doesn’t sell, the lender will become the owner and will try to sell the property themselves or with the help of a realtor. If you are wondering if the foreclosure will be the best option for you, contact our office and talk to one of our attornies to discuss the right option and direction for you to go. Often times, foreclosure can be avoided and we would love to discuss those options with you.