Foreclosure
Avoidance
THE BASICS
How It Works
Home Loan Transactions: Terminology
A promissory note is like an IOU. A promissory note is a document that contains a borrower’s promise to repay the amount borrowed.
Mortgages and deeds of trust give the power to foreclose. A mortgage—or, in some states, a deed of trust—is the contract that gives the lender the right to sell the home through a process called foreclosure if the borrower doesn’t make payments on the loan. When the lender records this document in the land records, it creates a lien on the home.
Endorsements and assignments. Promissory notes are transferable, and banks often buy and sell home loans. When a loan changes hands, the promissory note is endorsed (signed over) to the new owner of the loan. The seller documents the transfer by recording an assignment of the mortgage or deed of trust in the land records.
Foreclosure Steps
Nonjudicial foreclosures- In a nonjudicial foreclosure, an attorney or trustee—again, on behalf of the lender or investor—completes certain out-of-court steps. Typically, a nonjudicial foreclosure involves one or more of the following steps, depending on state law:
- mailing the borrower a notice of default that tells how much time the borrower has to reinstate (get caught up on payments)
- recording the notice of default in the local land records office
- mailing the borrower a notice of sale that states when the property will be sold. Like in a judicial foreclosure, the property is usually sold at a public auction.
Depending on state laws, a borrower might get a combined notice of default and sale, a notice of sale, or notice by publication in a newspaper and posting on the property or in a public place.
After Foreclosure: Right To Redeem Deficiency Judgments
What’s a redemption period? Certain states have laws giving a foreclosed homeowner the right to regain ownership of the home—called redeeming the property—after a foreclosure sale by reimbursing the buyer for the amount paid at the sale or by repaying the full amount of the mortgage debt.
What’s a deficiency judgment? Sometimes, a foreclosure sale doesn’t bring in enough money to fully repay the home loan. When this happens, the difference between the sale price and the amount owed is called a deficiency. In certain states, the foreclosing party can get a personal judgment—a deficiency judgment—against the borrower for this amount.
To learn more information and find out what will work in your particular case, please call us at 213-465-0936 or 323-532-2886.
STAY IN YOUR HOME
If you are facing financial difficulties, have received a Notice of Default and/or Notice of Trustee’s Sale, start exploring your options today. Below is an overview of 4 out of 9 options that you have to keep your home.
- Refinancing – With this option, you receive a completely new mortgage with new terms, interest rates, and monthly payments. The new loan completely replaces your current mortgage and may lower your payment, which could help improve your monthly financial situation. Refinancing may be an option if you’re current on your mortgage payments and have equity in the home.
- Repayment Plan – An agreement between you and your mortgage company that lets you pay the past due amount—added on to your current mortgage payments—over a specified time period to bring your mortgage current.
- Forbearance – An offer by your mortgage company to temporarily suspend or reduce your monthly mortgage payments for a specified period of time.
- Loan Modification – An agreement between you and your mortgage company to change the original terms of your mortgage—such as payment amount, length of loan, interest rate, etc. To learn more about the other 5 options available to you and your family to stay in your home, please contact us at 213-465-0936 or 323-532-2886.
How It Works
Home Loan Transactions: Terminology
A promissory note is like an IOU. A promissory note is a document that contains a borrower’s promise to repay the amount borrowed.
Mortgages and deeds of trust give the power to foreclose. A mortgage—or, in some states, a deed of trust—is the contract that gives the lender the right to sell the home through a process called foreclosure if the borrower doesn’t make payments on the loan. When the lender records this document in the land records, it creates a lien on the home.
Endorsements and assignments. Promissory notes are transferable, and banks often buy and sell home loans. When a loan changes hands, the promissory note is endorsed (signed over) to the new owner of the loan. The seller documents the transfer by recording an assignment of the mortgage or deed of trust in the land records.
Foreclosure Steps
Nonjudicial foreclosures- In a nonjudicial foreclosure, an attorney or trustee—again, on behalf of the lender or investor—completes certain out-of-court steps. Typically, a nonjudicial foreclosure involves one or more of the following steps, depending on state law:
- mailing the borrower a notice of default that tells how much time the borrower has to reinstate (get caught up on payments)
- recording the notice of default in the local land records office
- mailing the borrower a notice of sale that states when the property will be sold. Like in a judicial foreclosure, the property is usually sold at a public auction.
Depending on state laws, a borrower might get a combined notice of default and sale, a notice of sale, or notice by publication in a newspaper and posting on the property or in a public place.
After Foreclosure: Right To Redeem Deficiency Judgments
What’s a redemption period? Certain states have laws giving a foreclosed homeowner the right to regain ownership of the home—called redeeming the property—after a foreclosure sale by reimbursing the buyer for the amount paid at the sale or by repaying the full amount of the mortgage debt.
What’s a deficiency judgment? Sometimes, a foreclosure sale doesn’t bring in enough money to fully repay the home loan. When this happens, the difference between the sale price and the amount owed is called a deficiency. In certain states, the foreclosing party can get a personal judgment—a deficiency judgment—against the borrower for this amount.
To learn more information and find out what will work in your particular case, please call us at 213-465-0936 or 323-532-2886.
OPTIONS TO LEAVE YOUR HOME
Strategically Walk Away From Your Home
Homeowners who are struggling with their mortgage payments are facing tough choices—do you stay in a home you may no longer be able to afford or should you try to leave? While it may be difficult to think about leaving your home and making this decision, it may be the best option if other solutions to keep you in your home are no longer viable.
Don’t just walk away from your home.
There are better options. The most important thing is to avoid foreclosure—and options may be available to assist you if you are ready to leave your home. Some options may even offer cash incentives to help you move and transition into different housing. Now’s the time to take action before it’s too late. Check out the best options you and your family to strategically walk away with as much $$$ in your pockets.
- Short Sale– A short sale is the sale of a home for less than the balance remaining on your mortgage. If your mortgage company agrees to a short sale, you can sell your home and pay off all (or a portion of) your mortgage balance with the proceeds and walk away with relocation cash!
- Deed in Lieu– With a deed in lieu of foreclosure, or mortgage release, you transfer the ownership of the property to the owner of your mortgage in exchange for a release from your loan and payments.
- Foreclosure– A foreclosure is the legal process where your mortgage company obtains ownership of your home (i.e., repossess the property). A foreclosure occurs when the homeowner has failed to make payments and has defaulted or violated the terms of their mortgage loan. In a foreclosure, you lose any and all equity in your home, damage your credit for 7 to 10 years, and are left without a place to call home.
To learn the #1 way how we’ve helped hundreds of clients walk away with the most $$$ in their pockets and avoid foreclosure, please call us at 213-465-0936 or 323-532-2886.
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