Foreclosure timelines are different in all 50 states. If you are having a hard time making your loan payments, then you should look into your state's foreclosure laws.
Differences among the states range from the mortgage lender notices that must be mailed or posted, buyback periods and scheduling differences regarding the lenders sale of the property.
Below is a general understanding of the foreclosure timeline, but keep in mind the state where you reside will have its own laws. Few individuals believe they will fall behind on payments and lose their home, they always believe they have more time.
Note: Foreclosure timelines do vary by state
1st mortgage payment missed - your mortgage lender will contact you by phone or mail and a late charge will be assessed, usually after the payments been late for more than 15 days.
2nd mortgage payment missed - your mortgage lender is going to begin calling you to talk about why mortgage payments have not been made. It is essential that homeowners take these phone calls.
Talking to your lender and explaining your financial situation is absolutely critical to solving the problem.
Now that your 1st mortgage payment is more than 30 days late and you will receive one 30 day late on your credit, which will in all honesty will crush your credit score. Even if you have established credit, a mortgage late is to be avoided at all cost.
3rd mortgage payment missed - once the 3rd payment is missed, you will receive a letter from your lender telling you the amount you are delinquent, and that you have 30 days to bring the mortgage up-to-date. This is usually called either a demand letter or notice to accelerate.
If you do not pay the set amount or make some types of arrangements by the established date, the lender may start foreclosure proceedings.
They are unlikely to accept less than the total due without prior arrangements being made if you receive this certified letter. You do however, still have time to work something out with your mortgage lender before the foreclosure process starts.
4th mortgage payment missed - you are now approaching the end of a timeline which was allowed in your demand or notice to accelerate letter. When the 30 days ends, if you still have not paid the full amount or made arrangements you'll be referred to your lender's attorney. You will also incur all attorney fees as part of your delinquency.
Depending on where the house is located, the mortgage lender might record an official notice of foreclosure at the local courthouse, print details of the debt in the local newspaper, and attend hearings on the case.
Public Trustee's or Sheriff's Sale - Sale of the property will often be scheduled by the lenders attorney. This would be known as the day of foreclosure. You could be notified of the date by mail, a notice taped to your door, and/or the property sale could be advertised in a local paper.
The duration between the notice to accelerate or demand letter and the actual foreclosure sale vary by state. Some states may be as quick as 2-3 months although states do vary.
At this point your move-out date is near. You have until the sale date to make arrangements with your lender, or pay in full the amount owed, including attorney fees.
Redemption is the period of time after your home has been sold at a Public Trustee's or Sheriff's Sale, but you can still reclaim your house. Paying the full outstanding mortgage balance and all costs incurred during the foreclosure process is the only way to reclaim your house during the redemption period.
Many states do in fact have some sort of redemption period, availability is frequently determined by whether the foreclosure is judicial or non-judicial and procedures can vary greatly from state to state.
Important: Staying in contact with your lender is your single best choice to have a chance of staying in your house and be very careful of the many companies promising loan modification for a large fee. All dates are estimated, and vary according to your state and your lending company.
There are three types of foreclosures which could be started at this time: judicial, strict foreclosure and power of sale. All three types of foreclosure need public notices to be issued and all parties involved to be given notice regarding the proceedings. Once homes are sold through an auction, families will only have a small amount of time to move out before the sheriff issues an eviction order.
Every state in the union allows this type of foreclosure, and some require it. The mortgage lender files suit with the judicial system, and the homeowner should then receive a note by mail demanding payment. The borrower then has just 30 days to answer with a payment in order to fend off foreclosure.
If the payment is not made after a particular period of time, the mortgaged property is then sold through an auction to the highest bidder, a sheriff's office or local court will generally carry this out.
A small number of states actually allow this type of foreclosure as it favors the lenders tremendously. In strict foreclosure proceedings, the mortgage lender files a lawsuit on homeowner who has defaulted.
If the borrower isn't able to pay the mortgage within a certain timeline which is ordered by the court, the home goes directly back to the mortgage holder. Strict foreclosure generally takes place only when the debt amount is larger than the appraised value of the property.
This type of foreclosure, also recognized as statutory foreclosure, is permitted by many states if the mortgage includes a power of sale clause. Once a borrower has defaulted on mortgage payments, the mortgage lender sends out notices requiring payments.
Once an established waiting period has passed, the lender, instead of local courts or the sheriff's office carries out the public auction. Non-judicial foreclosure auctions are frequently more expedient, though they could be subjected to judicial review to ensure the legality of the proceedings.