But make sure the agent is comfortable with and has experience dealing with foreclosed homes as they are time consuming and tricky; not every agent is willing to negotiate these. County-owned foreclosures are properties that the county tax collector has seized because the owner didn’t pay property taxes. This website and its information is intended to provide visitors with general information about Steiner Law Group, LLC and is not meant to be construed as legal advice. We help people file for bankruptcy relief under the Bankruptcy Code.
From the lender’s perspective, foreclosure is necessary to recoup their financial losses. After taking possession of the home, most lenders will sell it to recoup the borrower’s unpaid balance. Foreclosures occur because your home acts as collateral guaranteeing your mortgage loan. If you don’t pay your loan as promised, the lender can seize the collateral — your house — and sell it to recoup the money they’ve lost due to your default. Every homeowner and home buyer should be able to answer this question. A foreclosure is a devastating financial event that takes years to recover from.
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They can sometimes even sell the house for a price lower than the market price, which could be a good opportunity for potential buyers. You aren’t the only one who prefers not to move forward with the foreclosure process — lenders don’t, either. Reach out to your lender as soon as possible if keeping up with your mortgage payments becomes challenging. Discussions can open up possibilities for a revised payment plan, forbearance or other alternatives to help you stay on track.
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- The lender’s attorney didn’t properly review the title search and, therefore, didn’t include all parties with an interest in the property in the foreclosure.
Mortgage defaults and foreclosures can increase due to an increase in mortgage interest rates, with some homeowners no longer being able to pay their mortgages. The year 2023 began with much higher interest rates and inflation rates than in previous years. This could lead to a further increase in unaffordability, eventually leading to a higher mortgage delinquency rate. While she’s relieved to have the legal process behind her, the financial fallout is a challenge.
What is Foreclosure Defense?
She also ghost writes textbooks, serves as a subject matter expert for online course design, and is a former college instructor. Under the Dodd-Frank Act, lenders can’t take action to begin foreclosure until you are at least 120 days late on paying. If you’re wondering “what is a foreclosure?” it helps to know how they work. The steps vary depending on whether you live in a state requiring judicial foreclosure or one permitting nonjudicial foreclosure. “What is a foreclosure?” is an important question for homeowners. Impact on your credit may vary, as credit scores are independently determined by credit bureaus based on a number of factors including the financial decisions you make with other financial services organizations.
- We have sent you an email with details about the refund and your invoice.
- This case settled, and the New York State Office of Court Administration agreed to implement the state law’s protections for homeowners across New York State.
- In some states, however, there is a redemption period after the sale in which the homeowner can make payment and keep their home.
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- If you’ve fallen behind on a few payments because of a temporary setback — a job loss or medical emergency, for example — your lender might agree to a structured plan for you to catch up on missed payments.
- This could lead to the bank reclaiming and selling the property to settle the debt.