If you are defaulting your mortgage loan, you may have the possibility of facing foreclosure on your mortgage property. It depends on your lender whether you will get the foreclosure notice or not. But it is advised to get help from a loan modification expert if you are having any issues regarding foreclosure. But before doing anything, get some ideas regarding foreclosure.
The foreclosure process?
In the foreclosure process, if you’ve taken a mortgage loan for a property and have failed to repay it, the lender can file a complaint against you in response to which the court can auction the property to repay the lender the due amount. Although you will receive a pre-foreclosure notice to pay the due within a limited period of time, the above-mentioned action will take place if you fail to do so.
There are 3 types of foreclosures but the process for all of them is basically the same. As soon as the property has been auctioned, you will have a very short time to leave the place. The 3 types of foreclosures are discussed below.
In the Judicial Foreclosure process, the lender seeks help with the judicial system. The loan modification inspector looks into the matter and the borrower is given the notice to repay the loan within 30 days. If the borrower does not respond to the notice or does not pay the due, the highest bidder will get the mortgaged property through an auction organized by the court.
Power of Sale
The Power of Sale foreclosure process is also called Statutory Foreclosure. In this case, instead of the judicial system, the foreclosure process is governed by a loan modification company or mortgage company. Once the borrower fails to meet the payments within the due date, the mortgage company organizes the auction. However, the judicial system reviews it to be sure that the process is legitimate.
This type of foreclosure is not seen much and only takes place if the due amount on the property is greater than the value of the property itself. If the borrower can’t pay after receiving the notice, the ownership of that property goes back to the lender again.