Stop Foreclosure [The Complete Story]
Are you facing Foreclosure?
- Behind on payments?
- In Foreclosure?
- In Redemption Period?
“What exactly is a note and a mortgage…what’s the difference?”
A note is simply a promise to pay. A mortgage secures that promise, using real estate as the collateral. When someone mortgages their property, they are conveying an interest in their property as security for payment of a debt.
“What happens if I am in default on my loan?”
If you are even one month late on your payment, the bank has the right to call the entire loan due. If you skip a month and try sending in one month’s payment the next month, the bank can send it back to you. If they accepted it, they would have to wait until you missed another payment to start the foreclosure process.
If your debt problems look severe or long lasting, the mortgage lender may take steps towards foreclosure. In most cases, before foreclosure actually occurs the lender will attempt to accelerate the loan. This means they are demanding payment in full on your note immediately. If you don’t, the mortgage lender will proceed with the foreclosure.
Once you are in default, the bank will start sending you letters, they will be friendly reminders at first, and then they will start to become more threatening…
This is the best time to bring the mortgage current again. However, it gets more difficult each month to do so. In the second month of default, you have to make a payment equal to two months payments, and in the third month, the payment must be for three months, and so on…
There are several steps to the process known as Foreclosure. If you fall behind (over 90-120 days) on your house payments, you may receive a Notice of Default.
A Notice of Default usually details how late you have been on your payments, how much you owe in principal and interest payments and how much money the mortgage company is requiring to be caught up on your payments, thus making your loan current.
There are laws in place that the mortgage company follows regarding sending you notices, etc.
If you have received a Notice of Default, DO NOT WAIT!
The longer you wait, the fewer your options; the more you stand to lose!
Because this is a very difficult situation for a person to face, many people put off dealing with the problem. Don’t let that happen to you. After a certain point, there are fewer and fewer lenders willing to rewrite your loan. An even if you can find a new loan, it will be at a much higher interest rate than you’ll want to pay!
“Foreclosure Time Frame”
- 30 Days: 30 days late payments that reoccur cause many additional late fees and service charges to be added to your payments in order to catch up. Refinancing may be the best option.
- “60 Days: 60 days late, results in more fees, more charges, more late payments which continue to accrue. Refinancing is probably the best option. A refinance or 2nd mortgage can lower your payments, pay off some debts, collections and/or liens to make it possible for you to continue making your payments on time and keep your home.
- 90 Days: This is a serious delinquency, more fees, more difficult to find a lender who will refinance your house or consolidate your debts.
- 120 Days: You are probably at the point of not knowing what to do. If you act now you still may be able to receive help. There are very few lenders willing to refinance at this point and the ones that are willing, want high rates and a lot of equity.
- 150 – 180 Days: In most cases, at this point you have been given notice of the Sheriff’s Sale. Your chances of recovering are very slim, short of a miracle.
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