If you are a homeowner who is facing foreclosure, this can be a quite a difficult time for you. Foreclosure can not only affect you, but also your spouse and children. This why it is important to know your rights as someone who is forced to deal with the threat of foreclosure. If you are fighting a foreclosure, you don’t have to be helpless, and the more knowledge you have about the process, the less stressful the whole experience can be.
Keep in mind state laws do vary, so this is something you will want to look into when learning your rights. However, most foreclosures follow a common line or process and you do have general rights during the process.
The Foreclosure Process And The Homeowners Rights
After most homeowners fail to make their monthly mortgage payments for a period of months (typically around 90 days) the lender will start the foreclosure process. This is so they can take complete ownership of the property as collateral on the mortgage.
If the lender decides to pursue a foreclosure then they must provide you — the homeowner — with written notice of that intention. The homeowner then has the right to pay back all the past due amounts along with the late fees and other penalties agreed to in the mortgage contract. If the homeowner does pay all the outstanding fees and past due amounts, the foreclosure process will be stopped.
Most homeowners cannot come up with all the money right away; otherwise they would have been paying it to start with. So the homeowner has the right to discuss payment options and alternatives with their mortgage lender. This is where the homeowner can try and renegotiate the terms of their mortgage so they can keep their property.
If they homeowner and lender cannot come up with a financial solution to save the home, the homeowner has the right to discuss the possibility of a private sale with the lender. Sometimes a private sale can yield a higher selling price than a foreclosure and it can pay off the existing mortgage debts and leave the homeowner with a bit of profit. Keep in mind the right of redemption would not attach to a private sale.
It is the homeowners’ right to remain in the home during the foreclosure process, if they choose to. But the responsibilities to maintain the home and pay the real estate taxes and home insurance come along with the right to stay in the home.
Right Of Redemption
In some states, if an agreement cannot be worked out prior to foreclosure, then the homeowner has the right of redemption. This statutory right allows the homeowner to regain ownership of the house by buying it back after the property has been foreclosed. The redemption law allows the homeowner to regain ownership of the home paying the foreclosure sale price and interest rate to the lender. This right usually is used within 6 to 12 months of the foreclosure sale.
Keep in mind the most important right of a homeowner is to have been treated fairly through out the foreclosure process.
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