Foreclosures

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What is a foreclosure?

Simply put, a foreclosure is a legal process by which a defaulted borrower is deprived of his or her interest in the mortgaged property.  What this means is against popular belief, a foreclosure is not a type of property, it is a process.  There are many steps in this process and ways to avoid it.  The process of a foreclosure is as follows:

• Borrower misses payment(s).

• Lender attempts to contact borrower.

• Lender sends notice of default, officially starting the foreclosure process.

• If borrower does not reinstate the loan(s) within the required amount of time, notice of sale is recorded and published.

• Foreclosure sale is conducted as published. (examples: Auction, Trustee’s Sale, Sheriff’s Sale)

• If unsold to another party, ownership of the property is involuntarily transferred to lender.  The property is now Real Estate Owned (REO).

The length of time for this process depends on several factors such as where the property is located, the lender, or the loan type.  It can take as little as 30 days or as many as 400 days. 

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