Q: If I lose my house in foreclosure are my chances of buying again lessened? – A: If you apply for a loan on another house your past foreclosure will show in your credit history. This does not mean you will not qualify for a loan; however you are less likely to receive, for instance, a low down payment loan. It is very important to stay informed and knowledgeable in how to stop the Foreclosure before it happens. There are people who are willing to take the time and help.
Q: If I am in foreclosure, how much time do I have until I have to leave the house? – A: Laws vary from state to state; in states like Georgia a foreclosure house for sale is advertised to the public only seven days after being filed. However in other states, the house is not publicly advertised until the 130th day of the foreclosure process. If you look online or go to the library and look up your state legislature, you will find a slue of detailed statutes. Do some research so you know exactly what timeline you are dealing with, but the bottom line is to act as quickly and wisely as possible.
Q: Does the lender have the right to repossess my house, even though I have been paying for it all this time? – A: Unfortunately, yes. Even though you only missed those few payments and had paid so many others, the mortgage documents or deed of trust (depending if you live in a judicial or non-judicial state) gives the lender the right to foreclose and repossess the property after you have defaulted on payments for a certain length of time.
Q. How does a foreclosure affect my credit? – Ans. Well, it is serious. The lenders I have spoken with tell me it will be about a 400 pt hit on you credit score. Really foreclosure is the last resort. There are a number of things that can possibly be done before you get to that point.
Q. When the lender forecloses you have to get out right away, right? – Ans. In Michigan when you miss your payment is 30 days past due you are in default, usually by the time a homeowner has missed 3 payments the bank and the collection department have been in contact(Note, return or answer those calls, they will try to work it out with you and possibly you will come out of it okay, it is better than going to foreclosure). At 90 days the loan is in serious default and the legal system begins to take over. Notice is served on the property by a posting on the property. In our area it is usually a notice tacked or stapled to the property by a deputy of the local sheriff. The Sheriff
Q. I have heard that the bank can take all of my property and even my retirement too, is that true? – Ans. No. They can only foreclose on what they have in the mortgage. No more, no less.
Q. Can I still live there after the Sherrif sells my house? – Ans. Yes, until the redemption period is up you can live in it. But if you move out, the lender may be able to accelerate the foreclosure period and take the property back quicker because the property was abandoned.
What is strict foreclosure? – Not a common procedure, a strict foreclosure does not require a sale. Once the proceeding has begun, the borrower has only a certain amount of time to pay what is owed. After this time, the title reverts to the lender. Strict foreclosure has been seen in many Oregon and California cases, usually taking place regarding land contracts.
What is non-judicial foreclosure? – Commonly called “power of sale”, this allows a lender to foreclose without a lawsuit, which is permitted by most states. Instead of a mortgage, the grantor (“borrower”) gives a “deed of trust” to the trustee to hold for the lender (“beneficiary”). When the grantor defaults, the lender files a notice of default and a notice of sale, published in the newspaper. This process takes only 90 days.
What is judicial foreclosure? – Used in about half of the states in America, a lender (“mortgagee”) brings a lawsuit against the borrower (“mortgagor”) to get the property. About half of the states use judicial foreclosure. Like all lawsuits, it starts with a complaint and summons to the borrower. When in judicial foreclosure, what happens if the borrower doesn