Many homeowners have questions about how foreclosure works and how much time they have between the time they miss a payment and the time the bank forecloses. If you’re wondering how long you have before you have to leave, it depends on whether your case will be handled in judicial foreclosure or non-judicial foreclosure. Most states allow both, but some states only allow one or the other so you will have to do your research to find out which one is yours for sure, but yours is most likely not judicial because it moves faster and costs less. for the lender.
All foreclosures
– You do not make your first payment (for example, we will say it is your July payment and is due on July 1).
– Your grace period expires (usually 15 days) and you have not paid. Your lender now considers your late payment. It is not uncommon to start receiving letters or phone calls from them at this time. Don’t ignore these phone calls.
– At most lenders, once you arrive 60 days late (September 2 in our case), your loan is considered delinquent and the lender can begin the judicial or non-judicial foreclosure process. To bring your loan current at this point, you will generally be required to pay all overdue amounts (your July and August payments), all late fees, and your September payment.
This is where lenders have the most flexibility in the process.. They are not required to enter the foreclosure process simply because a certain number of days has been delayed. If you are in communication with them and have come up with a plan to catch up, you can avoid foreclosure entirely, but you need to take action.
Judicial Foreclosures
– Your lender’s attorney will file a complaint with your county court and request a court date. Usually this doesn’t happen until you are more than 90 days late.
– You will be notified of this complaint.
– A hearing will be held in your county to determine the sufficiency of the complaint. If you think you have legal grounds to dispute the foreclosure, this is where you and your attorney would argue those grounds. At the end of this hearing, the judge will decide whether the complaint is sufficient or not. If so, the foreclosure sale will be scheduled and your credit history will be marked as foreclosed. If it is not enough, the judge will dismiss it. How long this will last depends on the courts in your area. Usually it takes 30-60 days.
– A date will be set for the redemption of the property if so stipulated by the laws of your state. You can still update your loan (including fees, etc.) until the redemption date. Even if the house has been sold and someone has moved in, if the redemption date hasn’t passed, you can still get your house back … if you can get enough money.
– A date will be set for the foreclosure auction. This usually happens between 30 and 45 days after the adequacy hearing.
*** A judicial foreclosure typically takes between 6 months and 2 years from start to finish. ***
Non-judicial foreclosures
– Your lender will send you a Notice of Default in the mail.
– Your lender will send you a Notice of Sale to inform you when your home will be sold at the foreclosure auction.
*** A non-judicial foreclosure typically takes between 1 month and 1 year to complete. ***
All foreclosures
– The foreclosure sale occurs and your home is sold. In about 90-95% of cases, your first mortgage owner wins the auction because he bid the amount you owe on that loan, and generally no one else will go beyond that.
Your homeowner then contacts the county sheriff, who posts an eviction notice on your door. This notice gives you 24 to 72 hours to leave the house and remove all your belongings. If you are there when the sheriff returns, he will escort you off the premises and everything left on the property will belong to the new owner.
