Unfortunately, more and more American’s are facing one of the scariest real estate processes: Foreclosure. We all know what foreclosure is: the process by which a property is claimed by a bank or other lending institution when the borrower defaults on their loan. What many do not realize is the process that occurs.
The foreclosure process does vary, depending on the state in which the property is located. Still, there are some generalized steps that must occur. Once a borrower falls behind on their mortgage payment, the lender is required to notify the property owner of their status. This is typically done by letter. The first attempt offers the home or property owner a chance to bring the loan current. At this stage the foreclosure process can be easily taken care of as long as the past due amounts are paid.
If the home owner is unable to bring their loan current and cannot come to an agreement with the mortgage holder, the foreclosure process starts in earnest. Legal notification in the form of a published intent to foreclose must occur. Still, the homeowner has a chance to bring the loan current, put the property on the market or short sell the property. If none of these events occur, the property will be foreclosed.
Depending on the state, a given amount of time must pass. This can be as long as six months. After the given waiting period, a court date will be set. This court hearing is to officially evict the property owner. Unless a very rare agreement is reached, the homeowner will be given a date by which they must vacate the property. If they have not vacated the property they will be physically evicted.
Foreclosure is a scary process, but with the number on the rise, more programs and assistance has become available.