Your Options Once Your House is in Foreclosure
Once the house is in foreclosure, you should decide if you have the ability keep the house or if you will be forced to give up the house. You have to examine your finances and make a realistic assessment of your income and expenses to determine if keeping the home is possible. If you do keep the house, you must reinstate, refinance, redeem, file a Chapter 13 bankruptcy, attempt a work out with the lender, or use a private investor. If you decide that you must give up the home, you must sell the house, offer a deed in lieu of foreclosure, or file bankruptcy, otherwise, you may be responsible for any losses your lender is subject to.
Right to Reinstatement
Once you have missed 2-3 payments, the lender will usually accelerate the loan (declare that the entire amount is due immediately). However, you may be able to reinstate the loan so that the scheduled monthly payments will begin again. To reinstate the mortgage loan, you must pay all delinquent payments, any interest or late fees on those payments, and any costs or expenses that the mortgage agreement says must be paid. The lender (or their attorney) should be able to advise you as to the total amount that must be paid.
Right to Redeem
You also have the right to redeem the house. This means that you can get the house back by paying the full amount of the loan still owed plus accrued interest and costs. Every state has its own redemption period, so make sure you become familiar with the foreclosure laws in your state.
There are two types of bankruptcy available to individuals. Chapter 7 bankruptcy, which eliminates most debts and Chapter 13, which allows a debtor to establish a repayment plan with the bankruptcy court. Chapter 13 allows you to keep the house and Chapter 7 generally does not allow you to keep the house. Filing for bankruptcy with postpone the foreclosure proceedings, including the sheriff’s sale and redemption periods.
We provide free foreclosure assistance and help for anyone who has fallen behind in payments, or thinks they may miss future payments. Simply fill out or free foreclosure evaluation and we will sent you our free e-book along with a customized step by step guide to help you get out of foreclosure.