Options For Foreclosure

A foreclosure is the legal process by which a lender, typically a bank, takes back possession of a property after the borrower has failed to make loan payments. The bank then sells the property in an attempt to recoup its losses.

Foreclosures can be lengthy and expensive processes and often lead to the displacement of the property’s occupants. There are three types of foreclosure: judicial, non-judicial, and power of sale. Judicial foreclosures are handled by the courts, while non-judicial foreclosures are processed outside of the court system. Power of sale foreclosures are the most common, and occur when the lender has the power to sell the property without going to court.

The foreclosure process begins when the borrower misses a payment. The lender will then send a notice of default, which informs the borrower that they have failed to make a payment and that the lender intends to take back the property. The borrower then has a set number of days to cure the default, which means to make up the missed payment. If the borrower fails to cure the default, the lender will proceed with the foreclosure.

What are the options to stop a foreclosure?

There are a number of options available to homeowners who are facing foreclosure. In some cases, the homeowner may be able to work out a payment plan or modification with the lender. However, lenders are not obligated to negotiate or modify conditions on a loan. For some lenders, it may be more cost effective to pursue the foreclosure and lose money than to negotiate. In other cases, the lender may find it beneficial to halt a foreclosure and work with the debtor on repayment terms.

For many people facing foreclosure, filing for bankruptcy protection is the fastest way to stop a foreclosure and secure assistance in creating a workout plan with the lender. The foreclosure process can be quick and complicated, which is why time is of the essence when dealing with foreclosures. If you are at risk of losing your home, contact a Sacramento bankruptcy lawyer today to review your options.