Foreclosure Prevention:
Foreclosure
What happens if your home goes into Foreclosure - Q & A
Q: How does a home go into foreclosure?
A: Foreclosure proceedings usually begin after a borrower has skipped three mortgage payments. The lender will record a notice of default against the property. Unless the debt is satisfied, the lender will foreclose on the mortgage and proceed to set up a trustee sale.
Q: When does foreclosure begin?
A: Lenders will initiate foreclosure proceedings when homeowners become delinquent in their mortgage obligations, usually after three payments are missed. The lender will then notify the buyer in writing that he or she is in default. The lender can request a trustee's sale or a judicial foreclosure, in which the property is sold at public auction.
A borrower can cure the default by paying the overdue amount and the pending payment after the notice of default is recorded, usually no later than a few days before the property's sale.
Some sales allow the successful bidder to take possession immediately. If the former owner refuses to vacate the premises, the court can issue an unlawful detainer that allows the sheriff to come out and evict them.
Borrowers should do everything they can to avoid foreclosure. It is one of the most damaging events that can occur in an individual's credit history.
Q: How long do bankruptcies and foreclosures stay on a credit report?
A: Bankruptcies and foreclosures can remain on a credit report for seven to 10 years.
Some lenders will consider a borrower earlier if they have reestablished good credit. The circumstances surrounding the bankruptcy can also influence a lender's decision. For example, if you went through a bankruptcy because your employer had financial difficulties, a lender may be more sympathetic. If, however, you went through bankruptcy because you overextended personal credit lines and lived beyond your means, the lender probably will be less inclined to be flexible.
Q: Can I prevent my home from going into foreclosure?
A: Yes. In some cases you can prevent your home from going into foreclosure. The most important thing if you are falling behind on your mortgage payments and trying to prevent Foreclosure is DON'T IGNORE THE PROBLEM. Homeowners who currently have, or expect to have, difficulty making their payments should contact their lender as soon as they realize they have a problem.
Options that you can try to prevent foreclosure are loan modification, selling the house yourself, selling the house as a short sale, or deed in lieu of foreclosure. As a last resort you may even consider filing for bankrupcy.
People in foreclosure frequently don't realize that there are a wide range of services available to them. These are not highly publicized; however, these offices, agencies and organizations are ready to help people who contact them. The services of many are free, others charge based upon ability to pay and there are also those who charge for their services.
At the national level the Department of Housing and Urban Development has HUD-approved counseling agencies. These have offices in most of the larger cities and urban areas in the country.
Many lawyers and legal aid societies offer help. These can be found through the local Bar Association.
Neighborhood Works America has local affiliates in many cities. Likewise Consumer Credit Counseling Services has branches in most cities and counties. They offer help to people facing foreclosure.
Many non-profit organizations have people who help on foreclosure issues.
Finally many city, county and state governments have offices which will lend a hand.
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