Nobody likes to talk about foreclosures especially if it is
their own. Unfortunately, foreclosures are occurring more
than ever in every part of the United States.
Need some advice on avoiding foreclosure?
Here is some general information about foreclosures.
Several states have a record number of foreclosures, such
as Arkansas, Arizona, Colorado, California, Florida,
Illinois, Massachusetts, Maryland, Michigan, New York, New
Jersey, Ohio, Texas, Utah, Virginia, and Wisconsin.
CNN Money reports that adjustable-rate mortgages,
especially mortgages that are considered, sub-prime
adjustable rate mortgages, continue to contribute to
foreclosures.
According to the San Francisco Chronicle, Americans
borrowed $2.2 trillion dollars through attractive
adjustable rate mortgages between 2004 and 2006.
These adjustable rate mortgages were hard to pass up with
low monthly payments.
However, all good things seem to have to come to an end and
they certainly have. Experts explain that these adjustable
rate mortgages need to reset themselves in order to make up
for the difference through higher rates, which means a
higher mortgage payment.
You don't need to be an expert in real estate to figure out
that when the banks significantly raise someone's mortgage
payment, you are going to see many foreclosures.
It's also predicted that as these mortgage loans reset,
1.11 million homeowners will lose their homes. This
prediction was reported following a study completed by
First American CoreLogic, a firm that documents home
mortgage risks.
If your mortgage remains unpaid after the due date for a
payment, the lender has the right to start a foreclosure.
Many banks will allow you a "grace period," so as not to
start any foreclosure process.
After a certain period of time, the lender will send you a
certified letter stating that your loan is in default.
Included will be any penalties and any unpaid mortgage
totals. It is important that you contact the lender to try
and work out a plan to pay the bank back.
Banks are not in the business of owning homes; banks are in
the business of lending money. Banks do not want the house
back! Contact them and try to work out an agreement to pay
them back the unpaid payments.
Your loan will likely be reinstated if you bring the
mortgage back to good standing if you pay back any
outstanding mortgage payments and fees.
If the lender has given you the allotted time to make the
loan current, and you cannot make the payments, the loan
will still be considered in default and there will be a
scheduled auction.
After the auction, if there is still a balance due, you may
still be required to pay back any outstanding debts. If
there is money left over from the auction, that amount of
money will go to the foreclosed homeowner, if all of the
fees have been paid to the lender.
With any court foreclosures, the sheriff carries out the
sale, which is about 45 days after the county clerk orders
the sale. It is considered a public auction, thus anyone
wishing to bid on the property, may do so.
Generally, the accepted bid must be paid to the sheriff no
later than 5:00 P.M. on the day of or the day after the
auction.
After the sale, a certificate of sale is issued. If the
property is not abandoned at the time of the sale up to the
next six months, this is known as the redemption period.
Some states will allow the borrower to redeem the property.
Any secondary lender may redeem the property within a
certain amount of time. In order to redeem the property,
the total amount owed including any fees, must be paid.
If there isn't anyone who redeems the property, the sheriff
will then transfer the ownership to the winning bidder at
the time of the foreclosure auction.
With Out of Court Trustee Sales, notice of the sale is
noted which includes the property description, date, time,
place, etc. The auction notice is then recorded with the
county.
The trustee mails the notice to all interested parties.
This notice is sent out three months before the sale date
and will be published in the local newspaper.
No less than 20 days before the sale, the foreclosure
auction notice is posted on the property and the county
courthouse.
The day before the sale is scheduled to take place and
leading up to the sale, the trustee must provide the
opening bid of the sale to anyone who inquires about the
sale. If not, then the sale may have to be postponed.
Out of Court foreclosure sales require every bidder to
provide a refundable $10,000 deposit in order to bid. The
trustee keeps the deposit of the individual with the
winning bid.
The winning bidder has until 5:00 P.M. by the next day to
pay his/her bid price.
Following the sale, the trustee then transfers ownership of
the foreclosed property within seven days. The proceeds of
the sale are paid directly to the primary lender, then to
any secondary lenders that exist.
With Out of Court sales, there is no right of redemption
for the borrower after an Out of Court foreclosure sale.
Bank foreclosures are at an all-time high. If you are an
investor, your'e likely to find foreclosures all around the
U.S.
Will foreclosures decline in numbers? Only time will tell.
This information is not considered legal advice to help you
avoid losing your home. It is always recommended that you
seek professional legal advice such as a local real estate
attorney.
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Cecilia Valenzuela is a full time entrepreneur and
supporter of small businesses. Cecilia Valenzuela works
with entrepreneurs striving to become successful. Cecilia
Valenzuela is a successful online business entrepreneur who
supports other online business owners. More information
about foreclosures including additional tips to avoid
foreclosures, is available
at:http://www.My-Arizona-Desert-Living.com/Arizona-Foreclosu
res.html
