Real Estate foreclosure, a subject that falls under the practice of Property Law and Real Estate, is the legal recourse a lender initiates to recover an unpaid balance on a home mortgage and other cost incidental to the foreclosure. Typically, the foreclosure process begins with a written notice of default sent to the borrower. In case of continuing default, the lender retains the right to sell the mortgage property in order to recover the money.
If you are going through a rough time financially and are now in danger of losing your home, here are some likely options you may be offered to reorganize your finances:
• A soft second loan, which is a second mortgage whose payment is forgiven or deferred until resale of the property.
• Pre-foreclosure sale, which will allow sale of the property and pay off the mortgage loan.
• Deed-in-lieu of foreclosure, which transfers title from borrower to lender to satisfy the mortgage debt.
• Special forbearance, which can help meet a new repayment plan by providing a temporary reduction or suspension of payment.
• Mortgage modification, which refinances the debt and/or extends the term and reduces the interest rate of the mortgage loan to bring payments to a more affordable level to the borrower.
• Partial claim payment paid to the lender, which brings the mortgage current with special assistance from the United States Department of Housing and Urban Development (HUD) by way of an interest free loan upon execution of a promissory note and subordinate charge over the property.
Always remember that under the Property Law and Real Estate Law the borrower is in the position to keep the property if the loan and foreclosure cost are paid off anytime during the foreclosure proceedings.
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