The home foreclosure process is a popular tune in this current economy. It is in fact emotionally wrecking, and why should it not be? After all, a homeowner can potentially lose their home in this process.
There are two prominent phases with every foreclosure process; i.e., pre-foreclosure and formal foreclosure. The pre-foreclosure phase is marked by different late notices, phone calls and eventual notice of default following several missed mortgage payments. If no steps are taken towards loan modification consulting and no arrangements made towards payment, the lender takes the process to the next phase of formal foreclosure.
Understanding the Formal Foreclosure Process
The foreclosure process varies from state to state with the major difference being in the legal documents used during the transfer of the property. There are states that use mortgages in this process while in other states, it’s the deeds of trust used. Based on this, different processes can be categorized as a judicial foreclosure (for states that use mortgage) and non-judicial foreclosure process for those that use deeds.
In the judicial foreclosure process, the lender or bank will have to go to the court for authorization. You can hire a loan modification lawyer to consult the bank so as to rearrange the terms of loan payment even before your lender takes the issue to court.
If a foreclosure order is given by the court, your lender or bank has the right to sell the house. A legal notice is then published in the local papers and the house is either sold to the highest bidder or reposed by the lender. Even after the notice of eviction is given, the bank or lender may still follow the original homeowner for the debts still owed on the house.