Foreclosure Help-A Brief Overview of the Types and What Could Happen

If you watch the news, odds are you are hearing more and more about foreclosure everyday, but it may not really dawn on you what all is involved until it actually happens to you. To protect yourself in case you do find yourself in this unfortunate situation at some point in the future, you should take the time to learn about foreclosure, the different types, and what you can do to protect yourself. In this article, you will find foreclosure help information that could help you, should the need arise.

Very few people can afford to pay cash for a new house outright, and because of that, in most cases financing is needed. To keep yourself out of foreclosure, you should make certain that you strictly adhere to the terms in your mortgage contract, including keeping your monthly payments up to date. If you do fail to maintain those payments, you could be found in default, which is how the foreclosure process begins.

Don't think that your home will be snatched out from under you just because you are late on or miss a payment, because that rarely is the case. In most instances, your lender doesn't actually want your property, just your payments, so will usually give you a three month time frame to get your payments up to date. If at that time you are still behind, then in most cases, the foreclosure process will begin. The exact laws are different for each state, so the time frames vary from state to state.

There are three main types of foreclosure: judicial foreclosure, non-judicial foreclosure, and strict foreclosure. Judicial foreclosure begins when a lawsuit is filed by the mortgage company against the home-owner. If you, the homeowner, don't respond to the suit, then the mortgage holder automatically wins the case, and you lose your home, no questions asked. In most cases, the home is sold at auction, and the proceeds are used to cover the outstanding mortgage balance. If enough funds are received to cover the entire debt, you could still be held responsible for the remaining portion.

In non-judicial foreclosures, no lawsuit is filed. The mortgage company notifies the homeowner that their loan is in default, and that they intend foreclosure, with an auction or sell of the home. The mortgage holder, in some cases, will still try to negotiate with the homeowner to allow them to catch up their loan and keep their home, if the homeowner is willing to respond and talk with the mortgage holder. In some cases, depending on the situation and policy of the lender, the homeowner may be given the option to delay or postpone payments, or add the past due payments back onto their mortgage balance to bring the loan current again.

In cases of strict foreclosure, there is no sale or auction, the home is repossessed by the mortgage company, who then uses their own agents to resell the property. Again, if not enough funds are recovered by the sale, the homeowner will still be held financially responsible for the remaining balance.

Hopefully, this foreclosure help article has been informative and valuable, helping you to know more about foreclosure, in the event you should have to face it in the future.