Posted on: 31st Mar, 2004 03:09 am
Judicial Foreclosure is the legal process where a lender repossesses the borrower's home because the borrower has defaulted on the mortgage. At the end of the foreclosure process, the court sells the house at an auction called a sheriff's sale.
The lender starts the proceedings depending on the terms and conditions of the loan agreement, the note and the mortgage that you signed at loan settlement, and your state's law. Some loans have an acceleration clause that allows the lender to call the loan due as soon as you default. Otherwise, whenever a loan is around 120 days past due, the lender files for foreclosure. The borrower may occupy the house until they are evicted after the sale.
How long can borrower occupy property after the sale?
After the judicial sale has been confirmed by the foreclosure judge, the new owner will file a request with the court to have the current occupants evicted. The new owner will then make a request with the Evictions Department to have a sheriff go to the house with an eviction notice. After the eviction notice has been served, how long the occupant(s) have to remain in the house is determined by state law.
Does the borrower pay for deficiency?
If the lender is unable to recover the total balance of the unpaid loan balance, the borrower has to pay the deficiency between the unpaid debt and the sale price, depending on the state. Some states do not allow a lender to get a deficiency judgment if the loan is a purchase money mortgage taken for buying the borrower's primary residence and secured by the property. These laws do not apply to second mortgages and investment properties.
Can borrower get back property after the sale?
Some states allow the borrower to save or reacquire the property even after the sheriff's sale. All the borrower has to do is pay the purchaser (who is most often the lender) the amount the house was sold for. Sometimes, the borrower may be able to work out an agreement that will allow him to occupy the property as a tenant.
What are the effects of foreclosure?
In order to have all subordinate liens wiped out, the plaintiff will join all the subordinate lien holders to the foreclosure suit. If the subordinate lien holders want to recover their interest, they need to bid for the property at the foreclosure sale.
Once the foreclosure suit is filed, it will remain on the borrower's credit report for 7 years after the sheriff's sale. This means the borrower will not be able to qualify for a new home loan with a reasonable interest rate for several years.
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Related Forum Discussions
The lender starts the proceedings depending on the terms and conditions of the loan agreement, the note and the mortgage that you signed at loan settlement, and your state's law. Some loans have an acceleration clause that allows the lender to call the loan due as soon as you default. Otherwise, whenever a loan is around 120 days past due, the lender files for foreclosure. The borrower may occupy the house until they are evicted after the sale.
How long can borrower occupy property after the sale?
After the judicial sale has been confirmed by the foreclosure judge, the new owner will file a request with the court to have the current occupants evicted. The new owner will then make a request with the Evictions Department to have a sheriff go to the house with an eviction notice. After the eviction notice has been served, how long the occupant(s) have to remain in the house is determined by state law.
Does the borrower pay for deficiency?
If the lender is unable to recover the total balance of the unpaid loan balance, the borrower has to pay the deficiency between the unpaid debt and the sale price, depending on the state. Some states do not allow a lender to get a deficiency judgment if the loan is a purchase money mortgage taken for buying the borrower's primary residence and secured by the property. These laws do not apply to second mortgages and investment properties.
Can borrower get back property after the sale?
Some states allow the borrower to save or reacquire the property even after the sheriff's sale. All the borrower has to do is pay the purchaser (who is most often the lender) the amount the house was sold for. Sometimes, the borrower may be able to work out an agreement that will allow him to occupy the property as a tenant.
What are the effects of foreclosure?
In order to have all subordinate liens wiped out, the plaintiff will join all the subordinate lien holders to the foreclosure suit. If the subordinate lien holders want to recover their interest, they need to bid for the property at the foreclosure sale.
Once the foreclosure suit is filed, it will remain on the borrower's credit report for 7 years after the sheriff's sale. This means the borrower will not be able to qualify for a new home loan with a reasonable interest rate for several years.
Related Articles
- How Judicial/Non-judicial Foreclosure works
- How to avoid foreclosure-17 ways to get out of mortgage mess
- How to decide between foreclosure and bankruptcy
- Loss Mitigation: Avoid Foreclosure with Loan Workout Options
Related Forum Discussions
- Can I sell property before foreclosure?
- What are the credit effects of foreclosure?
- What if the mortgage is in foreclosure and the borrower wants to continue it?
- Can I be taxed after foreclosure?
- Can I get tax lien redemption on foreclosed property?
- How long after a foreclosure refinance can I refinance again?
- Should I file bankruptcy to avoid foreclosure?
Do you know of a contract by the name above -- or something similar -- that is useful for protecting the rights of all parties to a foreclosure?
Thank you,
Chuck Jagoda
Thank you,
Chuck Jagoda
Hi Guest
Welcome to MortgageFit forum.
A foreclosure allows a lender to sell the property to get back his dues in case a borrower defaults on his mortgage payments. But there is a way by which the borrower can get back the title to the property even when the foreclosure has been conducted. This however depends on the state at which the borrower has taken the mortgage.
The foreclosure becomes ineffective through the right of redemption which allows a borrower to retain the title of ownership of the property even after the property has been sold off to a public trustee. But the borrower has to pay the total amount of the high bid along with interest at the default rate on the mortgage note. The period of redemption varies from state to state .
Hope you will be benefited from this information.
Please feel free to post further queries. Also sign up with us at http://www.mortgage.com/signup/ to avail free consultation on any related issues.
Regards,
Caron.
Welcome to MortgageFit forum.
A foreclosure allows a lender to sell the property to get back his dues in case a borrower defaults on his mortgage payments. But there is a way by which the borrower can get back the title to the property even when the foreclosure has been conducted. This however depends on the state at which the borrower has taken the mortgage.
The foreclosure becomes ineffective through the right of redemption which allows a borrower to retain the title of ownership of the property even after the property has been sold off to a public trustee. But the borrower has to pay the total amount of the high bid along with interest at the default rate on the mortgage note. The period of redemption varies from state to state .
Hope you will be benefited from this information.
Please feel free to post further queries. Also sign up with us at http://www.mortgage.com/signup/ to avail free consultation on any related issues.
Regards,
Caron.
We have a mobile home which is 4 years vacant since we have relocated ands are unable to sell it off. I have listed it with the realtor but non good luck with it. It has been 3 months now and we're still searching for a suitable buyer. On the other hand, we are current on both mortgages, the one on the mobile home and another on the home where we now live n. But it's getting troublesome paying off the two at a time and I am not able to afford the one on the mobile home. What should we do? Call the mobile home lender and talk to them frank;ly. will they offer us a short sale package? If suppose there is the foreclosure, what will happen to the house we live in, will that be affected by any lien or that sort?
Hi Derek,
Welcome to this forum.
If you have problem with mortgage payments on your mobile home, talk to your lender as soon as possible. See do not go for foreclosure. If you cannot make payments in anyway, go for deed in lieu or short sale as it will have less affect on your credit score.
“will that be affected by any lien or that sort?”
Now if it is foreclosed and after that you have deficiency to pay in full what you owe to your mortgage lender, than he may place a lien on you present house. So I shall suggest you to talk with your lender as soon as possible and go for the deed in lieu because in that case, there is no chance of placing a lien on your present house and your credit will be less affected.
Feel free to ask if you have any further questions.
Thanks,
Larry
Welcome to this forum.
If you have problem with mortgage payments on your mobile home, talk to your lender as soon as possible. See do not go for foreclosure. If you cannot make payments in anyway, go for deed in lieu or short sale as it will have less affect on your credit score.
“will that be affected by any lien or that sort?”
Now if it is foreclosed and after that you have deficiency to pay in full what you owe to your mortgage lender, than he may place a lien on you present house. So I shall suggest you to talk with your lender as soon as possible and go for the deed in lieu because in that case, there is no chance of placing a lien on your present house and your credit will be less affected.
Feel free to ask if you have any further questions.
Thanks,
Larry
Hi, after filing a bankruptcy, and having a home forclosed on, how long do I have to wait before I can apply for a home mortgage loan?
I think the home was foreclosed after the bankruptcy, isn't it? Please let me know which type of bankruptcy you have filed? have you received a discharge yet? You'll have to wait for a year or so if it's chapter 13 and if you'd like to go for FHA loans. More important is that you should have a clean credit report. For that obviously you need some time. I suggest that you check out the following pages to know when you can buy after bankruptcy and foreclosure:
When you can get FHA loans after bankruptcy
Mortgage after foreclosure
Thanks
When you can get FHA loans after bankruptcy
Mortgage after foreclosure
Thanks
My question is this... after an unsuccessful attempt at a shortsale of our home and our primary declining our request for a deed in lieu (due to a HELOC loan on the property), our HELOC jr lein holder is saying we still have to settle that debt. We've been tranferred to a collection agency for this debt and they gave us a settlement amount of 20% of the loan. I'm confused though, b/c I thought the jr. lien would be wiped out in the foreclosure. We don't know who to trust. Should we try to settle this debt or wait out the foreclosure process? The full 20% is still out of our reach, we'd have to use another loan to pay it off... from what I've read they could file a deficiency claim against us for the full amount, but most are saying that the odds of that are bad... but these are the same people who said we could sell this house fast a year and a half ago. We have no desire to keep the property as we've moved out of state... who can we go to for answers when the sharks have already smelled blood?
The junior liens are wiped away if you don't pay them off. The Heloc become unsecured debt when your house is sold off as because there's no collateral left. I think you should try to settle this debt.
To avoid foreclosure, you can rent out the property and start paying for the primary loan using the rental payment.
To avoid foreclosure, you can rent out the property and start paying for the primary loan using the rental payment.
yeah... tried the renting thing, not one taker. It's a beautiful home, there's just about 50 too many in our neighborhood.
Hi beth!
Welcome to the Forums!
As far as I know, the lenders generally forgive the deficient amount.
Sussane
Welcome to the Forums!
As far as I know, the lenders generally forgive the deficient amount.
Sussane
Got a question --
I dont want my house, have no equity in it, and cant get any help from my lender as they dont want to short-sell it. I need to be able to walk away from this bad investment, as the area has gotten dangerous for my family to live in.
To add to it, I have about $15K in cc debt. I'm current on everything, but looks like one way or the other, Im going to damage my credit over the house.
Since I need to get out of this property, I was thinking I would foreclose. Then when I consider the mountain of credit card debt I have, I figure I might as well throw it all into a bankruptcy.
So whats more damaging, long term? All the lawyers want me to file a bankruptcy, but I want the least negative approach.
Foreclosure or the bankruptcy?
I dont want my house, have no equity in it, and cant get any help from my lender as they dont want to short-sell it. I need to be able to walk away from this bad investment, as the area has gotten dangerous for my family to live in.
To add to it, I have about $15K in cc debt. I'm current on everything, but looks like one way or the other, Im going to damage my credit over the house.
Since I need to get out of this property, I was thinking I would foreclose. Then when I consider the mountain of credit card debt I have, I figure I might as well throw it all into a bankruptcy.
So whats more damaging, long term? All the lawyers want me to file a bankruptcy, but I want the least negative approach.
Foreclosure or the bankruptcy?
hi scott b!
as the lenders are not offering you a short sale, i don't think they will offer you a deed-in-lieu as well. its better if you could go for a chapter 13 bankruptcy. this will help you in reorganizing everything. the loss mitigation department will chalk out an easy plan through which you will be able to clear off your debts in 3-5 years. consult a lawyer for that.
thanks,
jerry
as the lenders are not offering you a short sale, i don't think they will offer you a deed-in-lieu as well. its better if you could go for a chapter 13 bankruptcy. this will help you in reorganizing everything. the loss mitigation department will chalk out an easy plan through which you will be able to clear off your debts in 3-5 years. consult a lawyer for that.
thanks,
jerry
If I go to foreclosure on one house, will they take away the one I live in.
The State is Florida
The State is Florida
Hi George C!
If one house goes into foreclosure, your primary residence will not be affected. However, the mortgage lender may place a lien on it.
Thanks,
Jerry
If one house goes into foreclosure, your primary residence will not be affected. However, the mortgage lender may place a lien on it.
Thanks,
Jerry
have a 2nd home which needs work. cannot afford to fix it up and pay the mortgage on both homes and other bills am retired and on a fixed income have used up most of my savings keeping all bills current