{"id":2351,"date":"2022-07-18T10:00:00","date_gmt":"2022-07-18T14:00:00","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=2351"},"modified":"2024-04-25T23:18:43","modified_gmt":"2024-04-26T03:18:43","slug":"how-to-survive-foreclosure","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/how-to-survive-foreclosure\/","title":{"rendered":"How to Survive Foreclosure"},"content":{"rendered":"\n
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On Options, and Running Out of Them\u2026<\/figcaption><\/figure>\n\n\n\n

When the economy is brutal<\/a>, foreclosures become more common. So do homeowners\u2019 questions about them.<\/p>\n\n\n\n

It\u2019s hard to make any blanket statements about dealing with the process, as it varies so much from state to state \u2014 and even from county to county. That said, foreclosures can occur when a home loan becomes just too much of a financial burden, and the owner simply cannot or will not make the payments any more.<\/p>\n\n\n\n

Foreclosure<\/a> is a term that dates back to the 1200s. It\u2019s from the early French word\u00a0forclos<\/em>, meaning\u00a0to exclude, shut out, or drive away. In today\u2019s legal terminology, it means taking over a home that\u2019s collateral for a mortgage. Given that a lender can evict a borrower, the meaning hasn\u2019t changed all that much in 800 years!<\/p>\n\n\n\n\n\n\n\n

Mortgage? Or Deed of Trust?<\/h2>\n\n\n\n

If a borrower stops paying, the mortgage lender will call the borrower, send a paper notification, and file the necessary paperwork to foreclose on the home. There are two main ways this happens. Some states use mortgages and must go through the court\u2019s foreclosure process. Other states primarily use deeds of trust<\/em> and can foreclose out of court.<\/p>\n\n\n\n

When a lender has to use the court system to foreclose (as in Delaware, Kentucky, Ohio, Illinois, Pennsylvania, and New Mexico), it\u2019s a more complex process and takes longer for the lender to carry out. In a deed of trust state (such as Maryland, Michigan, Virginia, West Virginia, or Tennessee), the lender simply sends a default letter to the borrower. This may involve recording a Notice of Default with the county recorder, but there is no need to get a court\u2019s blessing. The \u201cpower of sale\u201d clause lets the trustee for a deed of trust sell the property. In a deed of trust foreclosure, you do get a final opportunity to make good on the debt before the home is auctioned through a trustee\u2019s sale. Otherwise, it’ll be sold to pay the debt. You\u2019ll be refunded excess proceeds (if any) beyond what\u2019s owed on the loan.  <\/p>\n\n\n\n

Missed Payments and Not Sure What to Do?<\/h2>\n\n\n\n
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To slow down the process and have a chance of hanging onto the home, act. Speak to your mortgage company promptly. If your financial issues are likely temporary, explain. You might need to complete a hardship affidavit<\/a> to get relief. A lender\u2019s \u201closs mitigation\u201d options can include:<\/p>\n\n\n\n