Foreclosure & Alternatives Law
Losing your home can be a painful process. If you've fallen on hard financial times and are facing home foreclosure, you should go into the process informed of your rights and options during each stage. With the right help and information, you may be able to delay or prevent the foreclosure entirely.
A foreclosure is the result when a homeowner misses too many mortgage payments and their lender reclaims the property to resell at auction and make up the costs.
Individual state laws affect the specifics of your foreclosure process, but in general, your bank or mortgage lender can start foreclosure proceedings after several missed loan payments, usually around 90 days of delinquency.
Your lender is required to provide you with written notice of their intent to start foreclosure proceedings. This notice should give you a timeline for when the process will begin, often around 30 days, but possibly less. You'll be given a "reinstatement period," where you'll get the opportunity to pay your overdue bills, plus interest and late fees, which should stop the foreclosure process.
If you're unable to pay all that's owed in the time allotted, you may be able to work out a payment plan with your lender to extend your deadline and give you time to get caught up.
If the foreclosure moves forward, some states will require a court proceeding to move the foreclosure forward. If granted, local newspapers will print notice of the foreclosure, the lender will put your house up for auction, sell it, and within a set number of days you will need to vacate the property. The exact steps and timelines will depend on the state you live in, but eviction periods can usually last between a few days to a few weeks.
If your lender is unwilling to work with you on a payment plan, you still have a few options left.
You can reach out to the Making Home Affordable program, a government initiative that could provide you with financial counseling or advice. The housing agency for your state may have additional support programs that you could take advantage of as well.
A process known as "redemption" may also be an option for you. In many, but not all, states you have the chance to buy back the property after it's been foreclosed providing a new purchase price and interest rate.
You also have the right to take your lender to court. This could be especially helpful if you believe they've made a mistake and you want to prevent the foreclosure process from going any further. However, even without a lender's mistake, you may still have remedies through the court to stop the proceedings.
In some cases, filing for bankruptcy could save your home from a foreclosure. Loss mitigation applications and loan modifications could be options available to you as well.
If your lender tries to force you out of your home before your time limits are up, refuses to discuss any possible options with you, or doesn't provide you with notice before the foreclosure process begins, you may have cause for legal recourse.