Most homeowners facing foreclosure will have to deal with either a judicial foreclosure or the nonjudicial type, as these are the two most common methods that states allow lenders to take back properties. The lender sends the homeowner an Acceleration Letter, which is generally sent after a homeowner is at least two or three months in default. A Notice of Substitute Trustee Sale is what’s commonly referred to as a Foreclosure Sale Notice. A lender may choose to postpone or cancel the sale if the borrower is actively working with the lender to save the property.
Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualify for this relief. When the borrower cannot pay off the outstanding debt, negotiate a mortgage modification, or sell the property through a short sale, the property goes to auction.
In this case, they may try to obtain payment of the debt by a sheriff sale of the house, thus pushing it into foreclosure. ForeclosureRadar users have successfully purchased over $40 billion in properties at trustee sale auctions. Talk with your lender about a payment plan, a temporary forbearance, or a loan modification.
The second possibility is if the state law allows for a redemption period, which is extra time after the sale that homeowners can work to keep their homes. When they no longer have equity, some homeowners see no reason to continue making their payments. The lender initiates a foreclosure lawsuit against the homeowner.
For this reason, it is important to see an attorney as soon as possible, because, if you fail to answer within 20 days, or your answer does not meet other legal requirements, default judgment will be entered against you. Attendees learn how asking for a settlement conference can help them communicate more effectively with their lenders, as well as what resources are available to help homeowners prepare for the settlement conference.