What Happens During A Foreclosure ?
A foreclosure is a lengthy process and it is organized in order to auction a property. The mortgage lenders or banks foreclose properties when the borrower is not paying the loan amount. If anyone defaults on their payment for more than two consecutive months, then the property will be foreclose day the lender.
Before deciding on a foreclosure process, the lender sends several letters to the borrower about the impending foreclosure process. When the borrower does not respond, then the lender approaches the court requesting to foreclose the property. Then the court orders the lender to send another letter of warning and if the borrower does not respond even to that letter, the court sends out a notice to the borrower. The borrower has an option to just pay the amount and avoid the foreclosure on receiving the letters. If he or she is unable to do so, then the court will ask for the paper work like proof of delinquency and so on. In the mean time, the lender would also have reported to the credit reporting agency that the borrower has been delinquent.
Once the court processes the foreclosure papers which may take about three times they determine an auction date. On this auction date, the property will be sold. However, before that the lender needs to announce the auction date publicly through paper advertisements and also needs to display a board in front of the property. The borrower can repay the installments anytime during this period in order to stop the foreclosure.
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