The Complex Nature of Foreclosure

For many, owning a home is a dream come true, and learning that you may lose that due to foreclosure can quickly become a nightmare. Oftentimes, families also experience severe anxiety and depression because of the pressure of figuring out how to keep their home. Homeowners who are struggling with payments due to financial hardship may find the help they need through speaking with a lawyer who understands the complex nature of foreclosure. 

What is Foreclosure?

Foreclosure occurs when a homeowner cannot pay their mortgage on the property. When a mortgage loan is used to buy a property, the home becomes collateral to the loan. You agree to submit monthly payments on the mortgage in exchange for keeping the property until the debt is paid back. If you default on your mortgage loan, the lender may repossess the property and sell it in order to recover a portion or all of the outstanding debt. Proceeds that are not sufficient enough to satisfy the loan may result in the borrowing being held responsible for the difference. 

The 4 Stages of Foreclosure

In the U.S. there are two kinds of foreclosures: judicial and non-judicial. In nonjudicial foreclosure, the trustee has authority to put the home up for sale via the power-of-sale-clause, which secures a mortgage loan to pay the loan balance if the borrower happens to default. Though rare, judicial foreclosure does happen. The lender has the right of redemption, allowing them to purchase the home back from the successful bidder at auction for twelve months after the sale. The four stages of foreclosure can be summarized as:

  1. Missed Payment
  2. Notice of Default
  3. Notice of Trustee Sale
  4. Auction

If you are currently facing foreclosure on your home, the time to act is now. Consider reaching out to a foreclosure lawyer, alike to a team member from Kamper & Estrada, PLLC immediately.