Facing foreclosure? It’s okay. We understand life happens, and unusual circumstances like a divorce, death in the family, job loss, or any other financial curveball can make it impossible to stay on top of your mortgage payments. If foreclosure is looming, here’s what you need to know.
What is Foreclosure?
Foreclosure is when the loan borrower does not make their monthly payments on time. After two missed payments, the loan servicer is obligated by federal law to contact the borrower and notify them they have defaulted on the loan. This is when the foreclosure process starts.
1. Borrower is notified - When the borrower fails to make their monthly payments, the lender must send them a “notice of default”. This notification can happen by phone or in writing. Once the borrower has been notified, they have usually 30 days to bring the loan current and reinstate the loan.
2. Judicial or non-judicial foreclosure? - If the borrower cannot bring the loan current, the foreclosure process will be escalated. This part of the process can take up to several months.
- A judicial foreclosure is when an attorney on behalf of the lender files a lawsuit to foreclose the home. Then the borrower has a chance to respond to the lawsuit and go through the court process. If the suit goes uncontested, the court will decide that the foreclosure should move ahead.
- In a non-judicial foreclosure, out-of-court steps can be taken by the lender’s attorney. This starts with the “notice of default” and ends with informing the borrower when the property will be sold. This circumvents the court process.
3. Foreclosure sale - Next, the lender will have to put the borrower’s house up for sale, usually through auction. An auction is public, allowing anyone and everyone the right to make a bid for the house. The highest bidder becomes the new owner of the house. The goal is to recoup some of the investment and costs they lent to the borrower.
4. Eviction - Once it goes to the highest bidder, the borrower is evicted. It is no longer their home, it is the highest bidder’s. Depending on the state, the borrower is supposed to be moved out by foreclosure sale. Some states allow the old borrowers to stay until some action like a confirmation of sale happens. This usually gives them extra time to move out of the house and find another housing solution.
Your Options
If you find yourself facing foreclosure, you aren’t stuck. You do have options!
- Pay off the default balance. It may be difficult, but if you can scrounge up the money you owe and get back to good standing with the loan, you can keep your home and the foreclosure process stops! From there, just always find a way to make the mortgage payment and you will walk away from this situation like it never happened.
- Talk to your lender. Most lenders just want to make sure they are getting paid. So, if you have fallen behind, give them a call! More than likely, they can set up a payment plan to get you back on track and take away the threat of foreclosure.
- Sell to WCC Properties. WCC Properties helps turn their properties into cash fast! Instead of going through a grueling foreclosure process, regain your property and control and sell to WCC Properties. They can offer you a more than fair cash offer, close in 48 hours, and cover your closing costs and fees. While you may not be able to keep the house, you can potentially get out of your debt situation and start fresh without the multiple-month process.
If you go with this option, make sure you contact them sooner than later in the foreclosure process. This may be the answer to all your problems, so what are you waiting for?
