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What Happens During A Foreclosure ?
A foreclosure period can be divided into pre-foreclosure and foreclosure. A foreclosure means that the lender is going to sell the property to clear the mortgage amount. For the foreclosure procedure to be initiated, you must have defaulted on your payments for at least 60 consecutive days in most states. |
During this period the lender will try to contact you several times and even send you a letter. After the 60 day time period if the lender does not receive any response, then they will approach the court for a legal notice.
After you miss the third payment also the lender has the right to demand the mortgage payment in full. Even at this point, the borrower can still work out alternatives along with the lender. Once the court reviews your mortgage file, it will send out a notice to you giving you 30 days period to appear in the court for the foreclosure proceedings. If you do not appear, then the court will authorize the auction directly.
When you attend the proceedings the court will ask if you can pay the mortgage amount and clear the dues. Depending on the answer, the court can issue a foreclosure order which means it is authorizing the lender to auction your home to recover the mortgage amount. After this, a legal notice is given in the newspaper saying that the home will be foreclosed and an auction date is advertised along with it. Until the house is auctioned and sold, you can stay in the house.
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