The foreclosure process varies from one state to the next, and since some states are judicial and some are non-judicial, it’s best to search the exact laws for your state. Once you become a member, you’ll have access to all the up to date information about the foreclosure process and laws in your state. But this page is here to give you a general ideal of how the foreclosure process works.
Once you become 3-4 payments behind, your lender will generally have a trustee file a notice of default with your county court. This is the official start of the foreclosure process. The court will allow you a time period pay off the arrears on your mortgage and bring it back up to date, but if you can not do this, usually 3-6 months later, the home will be sold at public auction.
In many cases, once the home is sold, it is gone for good; however, some states offer a redemption period after this sale. This is a period of 6-12 months where the previous homeowner has the right to redeem the property. In order to redeem your property, you will probably need to come up with enough cash to either buy it at the sheriff sale price, or pay off the total mortgage in full. Since there is not a good chance of getting a mortgage approved, once you’ve been through the foreclosure process, you’ll need to find cash, or a private/personal loan.
If your property has been sold at auction and is out of the redemption period, the chances of getting it back are very slim. There are legal actions that can be taken to reverse the sale and it is even possible to buy the home back after the sale, but these options can be very time consuming and costly.
The odds of keeping your home are much, much better if you act quickly and take action before the sale, or even before the notice of default.
Every state is different, so become a member today to see the detailed foreclosure process in your state.
Bankruptcy laws and Chapter 13 bankruptcy can drastically effect the foreclosure process, so if you are facing foreclosure and you’ve used a bankruptcy to extend the foreclosure timeline, the laws and time lines may be different for you. If you need more information about bankruptcy, you can become a member and request our “Bankruptcy & Foreclosure” ebook.
Because banks and lenders are so backed up these days, the foreclosure timeline can now last over 1 year and sometimes as long as 3 years! But just because others have been lucky enough to get an extended time period, doesn’t mean you will too. It’s best to get help fast and stay one step ahead of your lender.