In Foreclosure

Power of Sale Foreclosure vs. Judicial Foreclosure, how fast can the bank foreclose?

First of all, most lenders will not begin foreclosure proceedings until a borrower is 3-6 months behind on their payments. Although missing a single payment is a default under the terms of most loan documents, lenders have neither the time nor the desire to foreclose on borrowers who have missed one payment. The process will be initiated when it becomes clear that the debt can no longer be serviced. This post deals with the timing of a foreclosure once your lender has started the process and has instituted a foreclosure action against your property.

The speed with which a bank can foreclose on a borrower varies based on state law. There are basically two different types of jurisdictions for foreclosure purposes: power of sale jurisdictions and judicial foreclosure jurisdictions. In over half the states, the prevailing method of foreclosure is non-judicial power of sale foreclosure. What does this mean? If you have entered into a deed of trust with your mortgage lender, your deed is held by a Trustee pending full payment of your note. In the event you fail to make your mortgage payments the trustee has authority to sell your home at auction. Power of sale foreclosure can occur much more quickly than judicial foreclosure because the trustee vested with the power of sale does not need court oversight to sell the property. The trustee will give Notice of a public foreclosure sale and then sell the distressed property to the highest bidder. A court will usually not oversee the process. If a default has occurred the trustee is permitted to go through with the

foreclosure sale after a relatively short notice period (usually two to three months from the date foreclosure proceedings are instituted). If you live in a power of sale Jurisdiction, your mortgage lender can complete the foreclosure process in two to three months. Today, 29 states (Alabama, Alaska, Arizona, California, Colorado, the District of Columbia, Georgia, Hawaii, Idaho, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, North Carolina, Oregon, Rhode Island, South Dakota, Tennessee, Texas, Utah, Washington, West Virginia and Wyoming) allow foreclosure by the power of sale

Judicial foreclosure is available in every state and is the required method of foreclosure in many states. Judicial foreclosure jurisdictions require a court to oversee the foreclosure process. Like power of sale jurisdictions, all interested parties must receive notice of the foreclosure sale. Judicial foreclosure proceedings can take a year or more to be completed . The requirement that the lender foreclose through the court system slows down the process considerably. While either method of foreclosure can be successfully challenged by an attorney, the court oversight of judicial foreclosure allows more procedural leverage to slow down aggressive lenders.

It is important for consumers to understand that they have rights in the fight against foreclosure. Power of sale jurisdictions allow for your property to be sold outside of court supervision but they still require you receive adequate notice of the sale and that your property be sold for a reasonable price. Hiring an experienced foreclosure defense attorney in a judicial foreclosure jurisdiction could buy you months while you fight back against the bank. Bankruptcy, although a last resort, will stop a foreclosure dead in its tracks due the Automatic Stay that freezes all creditor collection actions the minute a case is filed. I have filed many bankruptcy cases for clients the night before their home was scheduled to be sold at auction and had the process stopped. Chapter 13 bankruptcy may allow you to stay in your home while getting caught up on mortgage arrearages that have spiraled out of control. You have options and there is help available, but remember if you are in a power of sale jurisdiction and have

executed a deed of trust with your lender, the foreclosure process can be completed in a matter of months.

About the Author:

Visit to know more about bankruptcy at New York bankruptcy lawyer and personal bankruptcy NY

Article Source: ArticlesBase.com - How Long Does Foreclosure Take?

Statutory Redemption

After foreclosure the borrower has a period during which he/she may attempt to regain ownership of the property. In many states this right is guaranteed by legislation, and could be up to 1 year in most States, if the borrower is able to pay the amount that the property was sold for at auction then he/she will be allowed to keep the property. This period is referred to as the statutory redemption period.

In States that provide statutory redemption, the borrower may continue to live on the property during the statutory redemption period after foreclosure. If after the statutory redemption period the borrower has not redeemed the property the purchaser at the foreclosure auction gets possession and the title deed to the property.

States that provide for statutory redemption usually have higher foreclosure sale prices, which benefits both the borrower and creditors whom have an interest in the property. In States without this protection such as Texas for example all foreclosure sales are final.

In the Sates with such statutes, where mortgagors(borrowers) may redeem property after a mortgage foreclosure, the states have allowed statutory redemption in order to drive up foreclosure sale prices; this benefits both the defaulting mortgagor and his creditors who have obtained an interest in the property. The mortgagor is given an opportunity to match the sale price. This often has the effect of causing potential buyers of the foreclosed property to adjust their bids.

In a State without such a statute, such as Texas, this statutory right of redemption does not exist, and this means that all foreclosure sales are final, unless the courts overturn it on procedure.

Equitable redemption

Equitable redemption is a common law concept arising out of judicial opinions. It grants the borrower the right to reclaim the property by catching up all arrears mortgage payments, at any time prior to foreclosure. The major difference between statutory redemption and equitable redemption is that statutory redemption begins at foreclosure while the right to equitable redemption ends at foreclosure. All state courts recognize and uphold a borrower’s right to equitable redemption.

If you are currently facing home foreclosure it is important that you know what the Laws in your State are and what your rights are in terms of these Laws. Consider consulting a Professional who knows the foreclosure Laws applicable in your State as well as the practices of various mortgage lenders and may be able to negotiate on your behalf and help save your family home.

For expert advice on avoiding home foreclosure contact HomeAssure.Com for a
FREE Foreclosure Consultation

Regardless of what others may have told you, what you may have read or what you may think, a refinance loan to stop foreclosure is eminently possible. Several lenders exist, who will be quite happy to loan you money, regardless of your current credit rating or your past credit and mortgage loan history.

Every time a borrower applies for a refinance loan to stop foreclosure, the lender looks for three major things. The lender will scrutinize your credit history, your income and the loan to value. In case you are just 2 months, or less, behind with your mortgage payments, chances are that your credit rating is probably still in the acceptable range and you can qualify for the loan quite easily. If, however, you are more than 2 months in default, your credit will have suffered and you will have to show a more stable source of income than before or substantial equity in your home to be able to qualify for a refinance loan to stop foreclosure.

A loan for foreclosure refinance is a desirable option to be considered when your home is in foreclosure, but they can often be difficult to obtain. In most cases, you must be able to meet certain basic requirements in order to qualify for a loan. The basic requirements to qualify for foreclosure refinance may vary from one lender to the next.

A loan can often be quite difficult to obtain in the foreclosure stage because the payment record and the credit history of the homeowner have been affected negatively by the proceedings. A homeowner is also likely to have money trouble and is not likely to be putting money into the home, being unable to make the payments. When trying to obtain a loan, it is usually necessary to have a minimum of 30% equity in the home. Also, typically the credit history must be in fairly good condition. Homeowners may also be looking for a personal or an unsecured loan to stop a foreclosure proceeding. However, these loans are generally not easily available, unless your credit rating is very good. In such cases, if the application is rejected, the homeowner needs to explore all other options for obtaining refinancing.

Although, in most cases, mortgage loan companies do have a set of basic minimum requirements for a homeowner to qualify for a stop foreclosure loan, some lenders can be a lot more understanding of the circumstances of a borrower. Getting help from a professional company helps to ensure that your application for the loan will not be turned down merely on the basis of your credit at the current time, your lack of or reduced income or the lack of equity in the property. They can ensure that your case is thoroughly reviewed and merits are considered. Regardless of the mortgage credit history you have, you may still be able to qualify for a mortgage loan to stop foreclosure.

Even if you seem to be unable to meet the general minimum requirements for a mortgage refinance loan, remember that exceptions can be made. So, do some research, find out if you can still refinance your home and stop the impending foreclosure. Several of the non-traditional foreclosure lenders as well as private lenders, are fairly lenient with these general guidelines, and do lend up to 90% of the value of the property.

About the Author:

Stop Your Home Foreclosure by selling your home for fast cash. You can Sell Your Home Fast since we will buy your house for cash. We have offices in 15 cities to serve you. For a no hassle information package visit http://www.asisnow.com.

Article Source: ArticlesBase.com - Can Refinance Stop A Home Foreclosure?

Fannie Mae and Freddie Mac, two housing finance companies that have the implicit backing of the United States government, presently limit the mortgages they buy in the lower 48 states to a maximum size of $417,000. Alaska and Hawaii loans can be as high as $625,500. They also have a number of other requirements such as documented income, employment verification, and many others. A loan that does not meet the strict guidelines is considered to be non-conforming and is not eligible to be purchased by Fannie Mae and Freddie Mac. This includes all "jumbo" mortgages which are mortgages greater than $417,000. Loans are certainly available for these borrowers, however, it must come from other sources of capital such as banks, credit unions, and mortgage companies that often sell large pools of mortgages to investors. Historically, these loans would require rates to be perhaps ¼% higher than conforming rates. However, as investors lost a lot of money investing in mortgage backed securities that ended up being of poor quality, they immediately required higher rates of return on new mortgages. Now, jumbo loans are averaging about 1% higher interest rates than conforming mortgages.

Some politicians and regulators feel that by raising the loan size limit placed on Fannie Mae and Freddie Mac to as high as $729,500 in high cost areas, the value of property would be positively affected, especially in high cost states like California. This is virtually an economic certainty. Residential real estate historically sells based on debt ratios. Buyers were expected to spend no more than 30-40% of their gross income on housing. As such, any drop in rates would yield more buying power for each buyer that was taking out a loan. With a lower interest rate, a person can pay more for a house yet keep the same monthly payment. Giving buyers and current homeowners who want to refinance the access to lower cost capital will serve as an offsetting factor to downward price forces such as too much supply, higher levels of foreclosures, or home prices that don't reflect local incomes. The markets most affected by an increase in conforming mortgages would include: San Diego, San Jose, Riverside, Orange County, Los Angeles, San Francisco, and Sacramento.

The downside of raising the limits should also be considered. For one, if you cause the value of real estate to increase based on lower interest rates, you make housing less affordable to people like cash buyers that don't care about obtaining a loan. Additionally, Freddie Mac and Fannie Mae have faced a number of operational and accounting problems in recent years, and they also do not have a history of expertise in the jumbo loan market. Finally, you need to ensure that you are not heavily focused on the size of conforming loans while ignoring other factors such as attracting additional investment capital to the mortgage backed securities market or dealing with people that simply cannot qualify for a loan in the house they are in because they have negative equity or do not have the income to justify owning the home.

About the Author:

Donald Plunkett is a $299
flat fee
listing broker, writer, and blogger. He has been featured in REALTOR Magazine and Inman News. He
lists properties in California
and several other states. Visit

http://www.congressrealty.com
for more info.

Article Source: ArticlesBase.com - How Raising Conforming Mortgage Limits Would Impact California Real Estate

Bank foreclosures for sale mean properties requiring a new owner.  These properties are liabilities to the Banks, since the capital invested on them is blocked, because of the default in repayment.  The only way Banks could get back their capital is selling them off, as quickly as possible.

Talking of Bank foreclosures for sale, it is the predominant headache the US country is facing presently and is causing a crisis of devastating proportion to their economy.  Financial markets are struggling with the burden of this problem of high magnitude, as never-before in their history.  The US Government is under constant pressure to rectify the situation, by bailing out sinking Banks and financial institutions on the one hand, and mitigating the grievances of millions of home owners, faced with foreclosure of their equities on the other.

Bank foreclosures for sale are mounting in huge numbers month after month.  As a direct consequence of heavy Bank foreclosures for sale properties, in prime locations such as – California; Florida; Arizona; Nevada; Illinois; Texas; Michigan; Ohio; New Jersey; Georgia; North and South Carolina and New York – housing prices plummeted to lowest levels.  Properties in these States, which were unaffordable to many Americans, have become suddenly affordable with their bottom-level prices.

Although Bank foreclosures for sale reflect the misfortune of millions of home owners, undeniably they have opened up new vistas and avenues to first time home buyers and investors. People, who were only dreaming about embarking in home buying activity from the above locations, can now do so from Bank foreclosures for sale.

All they have to do is plan well their home buying strategy. They must first weigh their financial resources with reference to their household income, the amount they can spare in the monthly budget, towards repayment of mortgage loan installments and savings made so far towards meeting the initial payment upfront.  It is a fact that many Bank foreclosure for sale properties are quoted for prices well below the fair market value and can be comfortably met by the amounts of monthly rent people are presently paying.

After assessing their resources, the next step is to get their credit history standing qualified, for buying a housing property from Bank foreclosures for sale.  Qualified home buyers with sound financial backgrounds are welcomed by Banks on first priority, for disposing of Bank repossessed properties.  There are three types of properties listed in Bank foreclosures for sale. First is delinquent properties in the pre-foreclosure stage; second is properties fixed for foreclosure sale public auction on certain dates; and finally Bank-owned and repossessed properties lying as “non-performing assets” in their books.

It should be understood that all these types of Bank foreclosures for sale are properties having a selling pressure. The Banks are carrying the burden of incurring additional expenditure by maintaining these properties; safe-guarding the deserted properties from vandals; and keeping the Bank-owned properties in a marketable and ready-to-occupy condition.

Home buyers and investors can make best use of this precarious position of the Bank foreclosure for sale properties. Tactful negotiation, if needed with the help of buying Real Estate agent in the locality, can get them good and solid properties at never imaginable prices from Bank foreclosure for sale.

About the Author:

To learn more about making money with bank foreclosures for sale make sure to visit our site at ForeclosureRepos.com, the best place to search bank foreclosures by state!

Article Source: ArticlesBase.com - Bank Foreclosures for Sale are Worth Buying Profitably

Are you buying bargain properties by contacting owners facing a mortgage foreclosure? This is a tried and true method for finding motivated sellers. However, I've discovered a better source of leads, which you should consider trying, or adding to your mortgage preforeclosure business: tax sale preforeclosures. You'll contact owners who are about to lose their property due to non-payment of their property taxes.

Everywhere in the country, owners of real estate are required to pay property taxes. And everywhere in the country, some owners fail to pay their property taxes on time, or at all.

Each jurisdiction has a method for handling the collection of delinquent property taxes. Most of the time, all counties in a state will follow the same collection process, but occasionally you'll find variations within a state, or special rules for certain cities or counties within the state.

You'll usually find that the area you want to work in will follow one of two formats: a tax deed format or a tax lien format.

A tax deed format is the most straightforward: the jurisdiction will publish a list of properties with delinquent taxes that will be offered at a foreclosure sale, and the winning bidder at the sale will get a deed to the property. This deed usually wipes out the previous owner and all mortgages and liens that encumber the property.

A tax lien format is a bit more complicated; the jurisdiction sells a lien against the property to recover the taxes owed. The owner of the property does not lose ownership at this time. The owner is given a certain amount of time to pay off the lien, plus interest and tax sale costs, to the investor who purchased the lien at the tax lien sale. If the owner does not pay the lien in the time allowed by law, the investor can apply for a deed to the property.

You can research your state's tax sale online by reading its state statutes and contacting the tax collector. Regardless of the format your state uses, you can calculate a date on which owners will face loss of a tax-delinquent property. If the owner's property is going to a tax deed sale, that date will usually be the date of the sale. If the owner has a tax lien sold against their property, add the time allowed for the payment of the tax lien (the {"redemption period") and you'll have the date the owner will lose the property.

What we will do is contact the owner just prior to the date he or she will lose the property.

I've found that the properties you encounter in tax sale, and the owners who own them, are much different from those you encounter in mortgage foreclosure. You will find a much higher percentage of "walkaway" owners who are letting the property go, who may deed it to you for as little as $10, subject to the taxes owed. Though it seems hard to believe, owners walk away from properties all the time, especially if they have moved out of the area or the property needs repairs. Many don't realize they can sell the property without paying the delinquent taxes.

Another reason owners walk away is that the property was given to them as a result of an inheritance, and was never wanted or appreciated in the first place.

You'll also find that most of the properties you encounter don't have a mortgage; the mortgage company would have paid the taxes by now to preserve their interest in the property.

If you rehab properties for a living, this will be a rich source of houses needing repair. If not, just list the properties you get on the MLS and let a rehabber fix them up.

It's interesting to note that when you buy a property in tax preforeclosure for a bargain price from the owner, and resell or pay the taxes owed, you're removing the property from the tax deed list or preventing a tax lien investor from acquiring it. You may even become well-known to tax sale investors in your area. Go out and get some deeds out from under the tax sale investors today!

About the Author:

Rick Dawson is a former tax sale investor, turned DeedGrabber! DeedGrabbers purchase tax sale property from the right before the tax sale investors get their property. You can get deeds to these properties for as little as $10. Learn how today with Rick's new Ebook, Go
Ahead, Be a DeedGrabber!, available at his site DeedGrabber.com Or subscribe to his free 5-day email Mini-Course to learn more.

Article Source: ArticlesBase.com - Get Your Best Leads from Tax Sale Pre-Foreclosures

If you live in Alaska, Arizona, California, Colorado, Georgia, Idaho, Illinois, Mississippi, Missouri, Montana, North Carolina, Texas, Virginia, or West Virginia you probably don’t have a mortgage, even if the bank, your friends and common chatter call it one. It’s more probable that you own your home through a Deed of Trust: something that’s a lot like a mortgage but not exactly the same. For legal purposes, mortgages and Trust Deeds are two completely different instruments.

Don’t assume that the laws around one apply to the other. Unfortunately, because they’re the most common way of transferring title in over a dozen states, some sloppy commentators confuse the issue by calling Deeds of Trust "mortgages" anyway. Before you do anything with your note, find out exactly what you’ve got. Don’t trust phone conversations. Instead, take a look at your papers or better yet, get a lawyer to look at them.

Obviously, this article is not legal advice but we can give you some informal tips about the key features behind a Trust Deed. They are:

Title to a Trustee: The big, distinctive feature of a Deed of Trust is that it’s an agreement between three parties: a borrower, a lender and an impartial third party: the trustee. The property’s title goes to the trustee until it’s paid off, though the borrower can take possession of the property as soon as everybody’s signed off on the agreement. Nevertheless, the fact that the trustee has legal title to the property is a significant factor that influences what happens in emergencies such as non-payment of the loan. Trust Deeds are commonly held by a title company.

Promissory Note: Trust Deeds use promissory notes to set down evidence of the debt. The note defines the debt and its conditions, (such as the amount, interest, etc.) so it’s absolutely necessary to make sure everything’s accurate. The lender retains the note until the borrower pays the loan off, after which it is marked "paid in full" and transferred to the borrower.

Rapid Foreclosure: As we mentioned, the trustee has the property’s title, which means that it can initiate a foreclosure and sale itself. For various reasons, most trustees appoint another, separate trustee to handle this. In the event of a default in payment the trustee puts notice in public records for 90 days, initiates 21 days of newspaper advertising and then sells the property. The trustee doesn’t even need to take anyone to court. This sale is final, but a borrower can prevent this by coming to some arrangement during the 90 day period of record.

If you think you’ve got a Trust Deed, take a close look at your papers. Deeds of Trust and promissory notes can both be sold for substantial payouts.

About the Author:

DMO Direct Funding is a mortgage note buyer that accepts mortgages notes, land contracts and trust deeds from throughout the United States. Contact DMO for a free quote if you plan to sell mortgage notes.

Article Source: ArticlesBase.com - What Is A Deed Of Trust?

It is a crude fact of life that one person's misfortune is another's good luck and perhaps nowhere is this more apparent than in real estate. Foreclosed properties would not exist unless their owners were having problems.

If the borrower fails to abide by any of the terms of the mortgage, the lending institution may bring foreclosure action. By law all foreclosed properties have to be advertised and go to auction, so information on them is easy to find. Lenders will try to work out another option for payments by the debtor since they prefer not to foreclose. Failure of the owner to obtain a sale will result in the need for the lender to foreclose. At this point the lender may pursue two courses of action: foreclosure by judicial or non-judicial proceedings.

Judicial Foreclosure

A judicial foreclosure is a court action to cut out the right of redemption the debtor has in the property. The courts give the mortgagor a statutory period within which to redeem the property and a failure to do so results in losing the property.

Once the foreclosure by judicial sale takes place, the court confirms the price to ascertain that it was fair. If the price was extremely low, the court has the power to set the sale aside.

Non-judicial proceedings

In a non-judicial foreclosure, the state permits a foreclosure by power of sale provided the mortgage carries this clause. This allows for a quick recovery of the property for the lender or beneficiary. Any interest the debtor has is terminated, the property is sold, and the lender is reimbursed from the proceeds of the sale,

When a foreclosed property is sold, the lending institution, or note holder, is entitled only to the note or mortgage balance plus accrued interest, attorney's fees, and any out-of-pocket costs such as insurance, property taxes, and possible receivers' fees related to the foreclosed property. Any surplus money raised at an auction goes to the owner or borrower.

Investing in Foreclosures

Though foreclosures sound attractive, they are not necessarily a good investment as they typically require time, money, and effort to make profitable. A prudent buyer should therefore negotiate the purchase price with a substantial enough discount from the market price. It is important to remember that foreclosures are problem properties and purchasing them is assuming those problems. Thus, it is recommended that novice investors do not get involved with foreclosure properties unless the investors have the support of professionals who can provide appropriate guidance and advice.

Disadvantages of buying a Foreclosure property

The main drawbacks of buying foreclosures are:

o Buying foreclosures typically require all cash payment as the lenders rarely want to take back mortgages on foreclosed properties oOften foreclosed properties have been abandoned by the previous owners and may be in poor condition oIf the foreclosed property is an apartment building or complex, there may be substantial vacancies. Thus, there may be nonpaying tenants who have to be dispossessed, which entails legal fees and time.

If you follow late night infomercials, you might be tempted to think that anyone can make a bundle in the foreclosure market. Not so. You can be successful, but it requires a learning process, shrewd assessment, and the ability to walk away when the deal is not right.

About the Author:

This author, Lee Keyes, is a long time real estate investor and enjoys the challenge of foreclosure investing. You can visit him here: Realty Opportunities

Article Source: ArticlesBase.com - A Helpful Foreclosure Primer