There are many reasons why homes go into foreclosure. Dealing with foreclosure is going to be difficult no matter what the cause. So if you’re facing a foreclosure it’s crucial that you understand as much as possible about the process and what your options are.
What causes foreclosure?
When homeowners stop making mortgage payments or are late with their payments, the mortgage holder can begin the foreclosure process according to the terms of the mortgage agreement. It’s wise to at least make yourself aware of the number of payments that is stipulated in your agreement so you can do everything possible to avoid reaching this “magic” number.
How long can a homeowner stay in their home when it goes into foreclosure?
The law varies from state to state, so there is no set rule. In some states, homeowners can remain in the home for about a year. But in other states, the time frame may be as short as a few months. And in reality, there are some homeowners who don’t move out even when their home has gone into foreclosure. In that case, they may decide to wait for an eviction notice before leaving.
What is a redemption law and what is meant by a period of redemption?
If a home has been foreclosed upon, most states allow a period of time where the owner can pay back all overdue mortgage payments. This is referred to as a redemption law. Even if a home has been sold at auction, if the owner can come up with all monies owed, the redemption law allows a homeowner to reclaim their property within a specified period of time.
What is a short sale and how does it work?
In a short sale, the proceeds from the sale are less than the amount owed on the mortgage. The lender has to agree to accept less than is owed. In some circumstances, the seller may still have to pay the difference between the short sale proceeds and the amount owed. The advantage to a seller in a short sale is that there will be no record of a foreclosure on their credit history. Of course the disadvantage is that you have to come up with more money from another source.
What is meant by deed-in-lieu of foreclosure?
In this case the homeowner agrees to give the lender the deed to the house. In return the lender forgives the mortgage and cancels the foreclosure proceeding. You should be aware that this type of agreement will affect your credit to pretty much the same extent as a regular foreclosure.
Being informed can help a lot when you are dealing with foreclosure, so you are able to figure out your best options.
If you are facing foreclosure, you need help. Get free foreclosure information at http://getforeclosurefacts.com and find out how to stop a foreclosure