Foreclosure Process

February 9, 2009

Foreclosure Laws by State

Filed under: Foreclosure — Tags: , , , — @ 9:57 pm

Here we have a list of the State Foreclosure laws for a few of the
States in the US. 
If you have any questions you can refer to your local State government office or a lawyer for more information.

Florida Foreclosure Laws

Judicial Foreclosure Yes
Non-Judicial Foreclosure  No
Security Instrument s Mortgage
Right of Redemption Yes-brief and subject to court procedure
Deficiency Judgments Yes
Time Frame Usually 180 days

Judicial foreclosure in Florida is completely controlled by the court. The lender sues and obtains an order to foreclose. The court then defines the procedure to be followed. The court may or may not order that the notice of sale be published in a newspaper. If so ordered, it is the responsibility to place the notice for publication on the terms ordered by the court.

The sale technically ends any equitable right of redemption; however the court may extend the time for redemption, but rarely does so. In fact, there is a period following the sale during which the court reviews the sale to ensure a fair price has been paid. This usually takes about 10 days, and right of redemption remains in effect until court confirmation of the sale.

Should the court, for any reason, not confirm the sale, another sale is ordered.

The lender may also sue for a deficiency judgment.

Georgia Foreclosure Laws

Judicial Foreclosure Yes
Non-Judicial Foreclosure Yes
Security Instruments Deed of Trust, Mortgage
Right of Redemption Yes
Deficiency Judgments Yes
Time Frame Usually 90 days

Judicial Foreclosure: In the absence of a power of sale clause in the loan document that authorizes the lender, in event of default, to sell the property to pay off the loan balance, the lender must sue the borrower in court to obtain a court order to foreclose.

Non-judicial foreclosure requires that a notice of sale be published weekly in a newspaper of general circulation in the county in which the property is located for four consecutive weeks and mailed by certified mail to the borrower at least 15 days prior to the sale date.

The sale shall be conducted as a public auction on the first Tuesday of the month at the place designated in the notice of sale between the hours of 10:00 AM and 4:00 PM. If the day is January 1st or the July 4th, the sale will be conducted on the following day.

The defaulted owner has the right to redeem the property, and deficiency judgments are allowed.

California Foreclosure Laws

Judicial Foreclosure Sometimes
Non-Judicial Foreclosure Yes, most common
Security Instruments Deed of Trust, Mortgage
Right of Redemption Yes, judicial foreclosure only
Deficiency Judgments Yes, judicial foreclosure only
Time Frame 111 days or more

Judicial foreclosure in California is rarely used, and only in the absence of a power of sale clause in the loan document or when the lender is seeking a court order for a deficiency judgment. The lender must sue the borrower to obtain a decree of foreclosure and order of sale. The court may also order that the borrower has up to one year to redeem the property.

Non-judicial foreclosure is the most common form of foreclosure in California. This process is used when there is a power of sale clause authorizing the lender, in the event of default, to sell the property to satisfy the loan balance. If the power of sale clause includes the time, place and terms of sale, then that procedure must be followed. If not, the process is as follows:

A Notice of Defaultis recorded with the county in which the property is located when a borrower fails to make a loan payment. A copy of this Notice is sent by certified mail to the borrower within 10 business days of recording. The borrower has 90 days from the date of recondition to cure the default.

If the borrower fails to cure the default, a Notice of Sale is recorded. This Notice states that the lender or trustee will sell the property at auction in 21 days. This Notice is also sent certified mail to the borrower. It is also published weekly in a newspaper of general circulation in the county for three consecutive weeks prior to the sale date. The notice is also posted on the property, as well as in a public place, usually at the county courthouse.

The Trustee Sale Auction is held as a public auction at the time and place designated in the Notice of Sale, and conducted by the lender’s representative. The successful bidder must pay immediately with cash or cashier’s checks in the full amount of the bid. The successful bidder receives a trustee’s deed on completion of the sale. The lender usually bids in the amount of the balance due plus costs. If no one else bids, the property reverts to the lender.

The borrower has no right of redemption, and deficiency judgments may be pursued in non-judicial foreclosure.

Michigan Foreclosure Laws

Judicial Foreclosure Yes
Non-Judicial Foreclosure Yes
Security Instruments Deed of Trust, Mortgage
Right of Redemption Yes
Deficiency Judgments Varies, case by case
Time Frame Usually 60 days

Judicial foreclosure: The lender must sue the borrower and obtain a decree of the amount in default. The court then gives the borrower a brief time to cure the default. If the borrower fails to do so, the court issues a notice of sale.

Non-judicial foreclosure is used when the loan document contains a power of sale clause authorizing the lender to sell the property to pay off the loan in the event of default. If the clause specifies the time, place, and terms of sale, that procedure must be followed. Otherwise, the process is as follows:

  1. The notice of sale must be published weekly for four consecutive weeks in a newspaper of general circulation in the county in which the property is located. The notice must also be posted on the property within fifteen days after the first publication date.  

  2. The sale is held as a public auction by the lender’s trustee or the sheriff of the county between 9:00 AM and 4:00 PM on the date specified. The successful bidder receives a deed to the property that becomes operative at the expiration of the applicable redemption period.  

  3. The sale may be postponed by posting a notice of postponement at the time and place of the original sale date. If the postponement is for more than one week, the notice of sale must be re-published for four more consecutive weeks.  

  4. Right of redemption: If the remaining balance of the loan is more than two-thirds of the original amount-6 months; if abandoned-30 days. In all other cases, one year.

South Carolina Foreclosure Laws

Judicial Foreclosure Yes
Non-Judicial Foreclosure  No
Security Instruments Mortgage
Right of Redemption No
Deficiency Judgment Yes
Time Frame Varies

Judicial foreclosure in South Carolina requires the lender to sue the borrower in the court having jurisdiction over the county in which the property is located. If the court finds the borrower to be in default, a time is set during which the borrower may cure the default. If the borrower fails to do so, the court will issue an order of sale.

A notice of sale must be published for three weeks prior to the date of sale and posted at the courthouse and two other public places three weeks prior to the sale.

The sale shall be conducted on the first Monday of the month between the hours of 11:00 AM and 5:00 PM as a public auction by the sheriff at the courthouse in the county in which the property is located.

Following the close of bidding, the auction shall remain open for 30 days and additional bids accepted. In the event the successful bidder at the public auction is displaced, that bidder is entitled to a full refund of any monies paid.

If no objection to the sale price has been filed with the sheriff within three months of the sale date, the sale will be considered confirmed and the sheriff will provide a deed to the successful bidder.

Lenders may sue for any deficiency balance, and the borrower has no right of redemption.

North Carolina Foreclosure Laws

Judicial Foreclosure Yes
Non-Judicial Foreclosure Yes
Security Instruments Deed of Trust, Mortgage
Right of Redemption Yes
Deficiency Judgments Varies case by case
Time Frame Usually 60 days

Judicial foreclosure: In the absence of a power of sale clause in the loan document that authorizes the lender to sell the property in the event of default, the lender must sue the borrower to obtain an order to foreclose.

Non judicial foreclosure requires that the clerk of the court hold a hearing to determine whether or not a foreclosure may take place. The notice of hearing shall be served upon all parties at least 10 days prior to the date of the hearing. If the clerk of the court finds that foreclosure may proceed, the process is as follows:

The notice of sale must be mailed by first class to the borrower, published weekly in a newspaper of general circulation in the subject county for two successive weeks, with the last publication date not less than 10 days before the date of sale, and posted on the courthouse door at least 20 days before the date of sale.

The sale will take place at the subject courthouse on the date designated between the hours of 10:00 AM and 4:00 PM. The auction shall remain open and bids may be filed with the clerk of the court for 10 days following the sale date.

The sale may be postponed by announcement of postponement at the time and place of the original sale. A notice of postponement stating the new date and time of sale must be posted on the courthouse door.

January 1, 2009

Watch out for Forclosure Scams

Filed under: Foreclosure — Tags: , , , , — @ 4:57 am

Protect Yourself From Foreclosure Scams

Know what you are signing. 
There are a few things that you need to know when signing and forms that have to do with a foreclosure.  One of the first things is you should always seek advice from a lawyer or a trusted financial counselor.  Even the most will educated common person can run into documents that are too complex to understand.  Always read every document you sign.  You should never sign a document that has any blank spaces that could be filled in at a later date.  If there are any errors or false statements in any of the documents it could cause you serious problems later on.  Make sure that the errors are fixed and any blank spaces are filled in before you commet to sign the paper work.

Get promises in writing. 
Any oral promises or agreements that have to do with the foreclosure or even selling your home my not be legally binding.  Make sure that you get any of the promises or agreements in writing to protect yourself and  your home.  Keep copies of all the contracts you sign in a safe place so you will know where to find them if needed.

Make your mortgage payments directly to your lender or the mortgage service. 
Do not trust anyone else to make mortgage payments for you.  Also keep any records of your payments such as check stubs or make copies of each check.  In the memo section of your check jot down the month that you are making the payment for also.

Be very careful about signing over your deed. 
Always check with a lawyer or financial advisor before even thinking of signing over you deed to someone else.  Con artists and even a third party can take advantage of you and you could be loosing the rights to your home and any equity that might have built up in the home.  Make sure that you understand the terms of the deal that you are making when you sign your deed over to someone.

Report suspicious activity to the Federal Trade Commission and to your state and local consumer protection agencies. 
Don’t let other people fall victim to a con artists or any suspicious schemes.  Always report them to the proper agencies if you run into a problem.

Just a few more tips to help you through what may be a very tough time in your life.  You want to make sure that you make the foreclosure process and easy as you can if you have to go through it. 

 

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November 27, 2008

Ways to stop the Foreclosure Process

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There are a few ways that you can stop the Foreclosure Process.  First you need to find out if you are indeed in the worst possible position with your lender.  Make sure that you have talked with them and have done everything you can to fix the situation.  If your lender has filed a Notice of Default (NOD), you might think the loss of your home is inevitable then you can check out these different steps to see which one will work best for you.

Short Sale.   In some cases after your lender has filed for an NOD and before an auction your lender must consider any offers from a buyer on the property.  The lender or bank is just going to take the best offer on the house anyway, so if you can get an offer on the house then you can take it to the lender and let them know that you have found a qualified buyer.  Even after your bank or lender starts the foreclosure process you can seek any offers from any buyer and pitch it to them. 

Bankruptcy.   This can stop the foreclosure process dead.  To file a bankruptcy petition means that any debt collectors, including mortgage lenders, can no longer continue trying to collect from you by federal law.  Filing bankruptcy will freeze the foreclosure process until you get to court.  At this time the bankruptcy trustee’s role is to play referee or to mediate between you and the creditors.  This will more then anything help to buy you more time to replace the job that you might have lost to get into the position that you are in financially.  The law requires your mortgage company and other creditors to work in good faith with you to formulate a reasonable repayment plan so you can get back on track.  Talk with a bankruptcy attorney regarding whether filing for bankruptcy is a good strategy for you.

Deed in Lieu.   With this process you voluntarily sign the deed of the home back over to the bank if you are facing foreclosure.  This also has the same impact on your credit repost as foreclosure.  In this case the homeowner must pay any second or third mortgages or home equity lines before going on with the deed in lieu.  The lender will also want to make sure that you financial problems are real.  Also the lender will want to be careful that the homeowner will not come back later and try to sue them alleging they did not understand what they were doing.

It will be hard to get a mortgage company to go on with the deed in lieu but if you make all the right demands that they ask for it can work in your favor.  It is always worth the try.

Assumption/Lease-Option.   Talk with your lender to see if you have a “due on sale” clause in you mortgage.  This will read that you must pay off the loan entirely if you transfer the property.  In some cases if you can find someone to assume the mortgage you can ask your lender to remove this clause if the new buyer’s qualifications meet what they are looking for.  You also might be able to get a down payment from the new buyer to off your outstanding past due balance. 

With a lease-option the new buyer becomes your tenant and the property stays in your name until they have saved enough money for a down payment.  The new buyer also will have to repair their credit score to the requirements of the lender.  The down payment will be used to bring your mortgage current and putting you back on good terms with the lender.  Make sure that you negotiate a lease payment with the new buyer that will cover your payment and the property tax and insurance.  All the while you will be able to put any extra money into a savings account to go towards any repairs to the home that come up.

I hope this helps you is some way to figure out the best option for you and your family.  If you have any suggestions to improve this list please feel free to leave me a comment.

 

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Stats on Foreclosure

Filed under: Uncategorized — Tags: , , , , — @ 10:16 am

A record number of home prices fell in 120 metropolitan areas, but rose in 28.  Four areas were unchanged which made for the worst since 1979.  The median declined 9 percent from a year earlier to $200,500.  Sales accounted for at least a third of all transactions on properties with a mortgages that were in default.  Mark Zandi, chief economist at Moody’s economy.com said “housing is front and center of the financial crisis”.  “So long as house prices are declining and foreclosures mounting, the financial system will struggle and the economy will be in recession.”

 

Companies cut 1.4 million jobs in the last six months which were the biggest cuts since 1975.  U.S. sub-prime mortgages market has caused $666 billion in losses for banks, lenders and insurers.  This has brought the U.S. to a huge financial crisis.  The largest declines in home prices were in California around the San Bernardina area.  39 percent fall to $227,200. It fell 37 percent in Sacramento to $212,000, and 36 percent in San Diego.

Some areas of the contry had an increase such as Elmira, New York which saw a median rise of 13 percent to $105,000 and in Decatur, Illinois it rose 8.7 percent to $93,400.  During the quarter, foreclosures boosted sales of single- family houses and condominiums to 5.04 million at a seasonally adjusted annual rate, the report said. That was up 2.6 percent from the second quarter.

The reason for the ups and downs in home repossessions is because the government failure to effectively deal with the unaffordable loans and foreclosures.  Federal Deposit Insurance Corp. Chairman Sheila Bair said in testimony Tuesday to the House Financial Services Committee in Washington.  “Minimizing foreclosures is essential to the broader effort to stabilize global financial markets and the U.S. economy,”

Home price index, S&P/Case Shiller, tracks 20 cities say this will be as much as 14 percent in 2008 and 7.8 percent in 2009.  Freddie Mac said in a says that combined sales of new and existing homes probably will fall to 4.87 million, which would be down 35 percent.  This is from the record 7.46 million sold in 2005.

 

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November 26, 2008

Top Foreclosure News

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Get all of the top Home Foreclosure information right here.


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Laws to protect you in foreclosure

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Here we will be letting you know of some of the laws that may help protect you when you are faced with a foreclosure.  Please read this post carefully and then contact your local government office and a lawyer if need be.  Every case can be different.

Truth in Lending Act (TILA

The purpose of the Truth In Lending Act is to show meaningful disclosure of credit terms. This is so the  borrower will be able to compare the terms of different loans and to protect the consumer against unfair lending practices.

You can have the foreclosure procedure rendered null and void if the documents do not meet the requirements set by the laws.  Even after the redemption period has expired the judgment could be withdrawn if you can prove that the lender did not make a sufficient effort to contact you or if there were some errors during the foreclosure process.  If you find that the lender made no mistakes you could still answer each point of the lender’s contention and explanations that you think the court should consider.

Not only can TILA be used to immediately stop the foreclosure process (if you currently are in foreclosure), but it also lets you avoid bankruptcy. Once TILA  violations are discovered in your loan documents, your lender will be eager to discontinue the unlawful foreclosure process and settle the dispute. If you are not given a notice of the right to cancel the loan or you did not receive notice with the correct materials (hence you can cancel your loan up to three years later).  The TILA is required to provide you with a easy to understand terms of the loan, (layman’s terms if you will).

The “National Consumer Law Center’s Truth in Lending” manual provides detailed information on how this law can be used to Challenge predatory lending.

Also check into the following:

  • Real Estate Settlement Procedures Act (RESPA)
  • State Unfair and Deceptive Acts and Practices Laws (UDAP)
  • Home Ownership and Equity Protection Act (HOEPA)

 

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Stages of the Foreclosure Process

Filed under: Foreclosure — Tags: , , , , , — @ 3:42 am
STOCKTON, CA - APRIL 29: A foreclosure sign i...

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Stages of Foreclosure

The foreclosure process is not that difficult to understand. There are several stages in which a homeowner has an opportunity to get the loan payments up to date and avoid foreclosure.

In the time that the loan becomes three to six months delinquent, the bank or lender orders a trustee to record a notice of default at the county recorder’s office.  This is to let the lender or homeowner know that he or she is facing foreclosure and starts a reinstatement period that can last until five days before the hoe is auctioned off.  The loan then must be brought current within three months or a sales date will be established.  At this time the homeowner will receive a notice of sale and this notice will be posted on the property.  This notice will also be sent to the county recorder’s office and be listed in the local county newspaper for about three weeks or so.

The next step is the auction of the property to the public.  This auction will be held on the steps of the county courthouse in which the property is located.  A time and date of the sale will be set in the notice of sale papers.  The highest bidder will have to pay the amount in cash which can usually be made in the form of a deposit up front and the remainder within 24 hours.  After this the winner can receive the trustee’s deed to the property.

Each county can have different laws so please check with your local county office to make sure that you know just how your county handles the foreclosure process.

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