{"id":369135,"date":"2016-04-04T10:47:15","date_gmt":"2016-04-04T15:47:15","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/realestate\/foreclosure\/more-foreclosure-frequently-asked-questions.html"},"modified":"2024-10-16T14:37:45","modified_gmt":"2024-10-16T19:37:45","slug":"more-foreclosure-frequently-asked-questions","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/realestate\/foreclosure\/more-foreclosure-frequently-asked-questions.html","title":{"rendered":"Foreclosure Frequently Asked Questions"},"content":{"rendered":"\n
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Foreclosure Frequently Asked Questions<\/h1>\n
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\n By FindLaw Staff<\/a> | Legally reviewed by Robert Rafii, Esq.<\/a>\n | Last reviewed\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

No one wants to be forced into foreclosure after finding a suitable home. But sometimes, it’s unavoidable in homeownership when times get tough. However, homeowners have several ways to prevent foreclosure or manage the process more smoothly. Below are answers to frequently asked questions regarding foreclosure prevention.<\/p>\r\n

See FindLaw’s Real Estate Foreclosure<\/a> section for additional articles and resources.<\/p>\r\n

What is foreclosure?<\/b><\/h2>\r\n

Foreclosure is the legal means your lender can use to repossess (take over) your home. When this happens, you must move out of your house. Your bank may conduct a foreclosure auction to sell your home to the highest bidder. They’ll give you a notice of sale informing you of their intent to sell the property to a new owner via a public auction or other sale.<\/p>\r\n

If your property’s market value is less than the total amount you owe on your mortgage loan, your lender may pursue a deficiency judgment<\/a>. If that happens, you not only lose your home, but you also owe your lender an additional amount. Both foreclosures and deficiency judgments could seriously affect a borrower’s credit score. So, you should avoid foreclosure proceedings if possible.<\/p>\r\n

In states that allow nonjudicial foreclosure, your home loan note or deed of trust may have a power of sale clause. This means your lender can conduct a foreclosure sale without going through the court. Not all state laws allow for this legal process, as many require judicial foreclosure<\/a> instead.<\/p>\r\n

I am receiving letters from my lender regarding missed mortgage payments. What should I do?<\/b><\/h2>\r\n

Do not ignore letters from your lender. If you are having problems making payments, call or write to your lender’s loss mitigation department as soon as possible and explain your situation. Be prepared to provide them with financial information, such as your monthly income and expenses. With this information, they may be able to help.<\/p>\r\n

If you’ve missed payments, your home may have gone into pre-foreclosure. If you do nothing, you could receive a notice of default. You’ll soon be facing foreclosure. Ideally, you should get in touch with your mortgage servicing company and resume your monthly mortgage payments.<\/p>\r\n

You may have incurred late fees for past-due payments, but it’s better to pay them if possible. You can avoid foreclosure by bringing your payments up to date to restore your relationship with your lender. This is known as mortgage reinstatement.<\/p>\r\n

Are any free housing counseling services available to homeowners struggling to stay in their homes?<\/b><\/h2>\r\n

Yes. The U.S. Department of Housing and Urban Development (HUD) website provides a directory of HUD-approved housing counseling agencies<\/a>. You can also call (800) 569-4287 or TDD (800) 877-8339 for the nearest housing counseling agency.<\/p>\r\n

Housing counselors can provide information on services and programs offered by government agencies, as well as private and community organizations that could help you. The housing counseling agency may also provide credit counseling. These services are usually free of charge.<\/p>\r\n

Are there any alternatives to foreclosure?<\/b><\/h2>\r\n

Yes. You may qualify for several alternatives to the foreclosure process, including special forbearance, in which your lender may arrange a repayment plan based on your financial situation. They may even provide for a temporary reduction or suspension of your payments. Other types of foreclosure alternatives include:<\/p>\r\n