Foreclosure Attorney Overview

Legal Help From a Debt Relief Lawyer When Defending Against Foreclosure

Facing the threat of foreclosure can be one of the most emotionally and financially overwhelming experiences a homeowner may endure. The prospect of losing one’s home due to missed mortgage payments can lead to confusion, anxiety, and a desperate search for solutions. Fortunately, with professional guidance and the right legal tools, many homeowners can delay, contest, or entirely stop foreclosure proceedings.

Understanding the Foreclosure Process

Foreclosure typically begins after a homeowner has missed several mortgage payments. The lender will issue a notice of default or a notice of intent to foreclose. This begins the formal foreclosure process, which can be judicial or nonjudicial:

• Judicial Foreclosure: In this process, the lender will file a lawsuit against the borrower, and the case will proceed through the court system. The borrower will have the opportunity to respond to the complaint and use various legal defenses to demonstrate why the foreclosure should not move forward.
• Non-Judicial Foreclosure: In some states, a foreclosure can be completed without court approval. Instead, the lender will follow a series of state-mandated steps to repossess and sell the home.

If a court rules in favor of the lender or a lender meets the requirements to proceed with a non-judicial foreclosure, the property will be sold through an auction. After the sale occurs, the new owner may begin eviction proceedings, requiring the original owner to vacate the property and remove all of their belongings.

The foreclosure timeline can vary significantly depending on state laws, the type of mortgage on a home, and the specific steps followed by the lender. In many cases, the process will take several months or more than a year.

Legal and Financial Strategies to Defend Against Foreclosure

A homeowner who receives a foreclosure notice should take immediate action to determine what options may be available to prevent the loss of their home. An attorney can provide guidance on the legal and financial strategies that may be available to delay or prevent the loss of a home. Options may include:

• Loan Modification: This option involves negotiating new loan terms with the lender. These modifications may include a reduction of monthly payments, changes to the interest rate, or an extension of the term of the loan. A lawyer can assist with these negotiations, working to find solutions that will allow a homeowner to catch up on missed payments and continue making affordable payments so that they can avoid the loss of their home.
• Forbearance Agreements: In cases involving temporary financial hardship, lenders may agree to reduce or suspend mortgage payments for a limited time. While this will not erase any missed payments, it can provide breathing room for the homeowner to regain financial footing and continue making regular payments in the future.
• Repayment Plans: Instead of proceeding with a foreclosure, a lender might accept a repayment plan that allows the borrower to catch up on missed payments over time while also making regular monthly mortgage payments.
• Short Sale or Deed in Lieu of Foreclosure: If keeping the home is not possible, a short sale (selling the home for less than what is owed) or a deed in lieu of foreclosure (voluntarily transferring ownership to the lender) may help avoid some of the consequences of foreclosure and limit the impact on the borrower’s credit.
• Filing for Bankruptcy: A homeowner can put a stop to the foreclosure process by filing a bankruptcy petition. While their case is ongoing, the automatic stay will prevent creditors, including mortgage lenders, from taking any actions to collect debts or seize collateral. Chapter 13 bankruptcy may be the best option for preventing a foreclosure and ensuring that a person can maintain ownership of their home. In addition to making regular monthly mortgage payments, a Chapter 13 repayment plan may allow a person to pay off any missed payments and penalties. Once the bankruptcy process is complete, other debts may be eliminated, making mortgage payments more manageable.

Common Situations Where Foreclosure Defense May Be Necessary

Homeowners may find themselves at risk of foreclosure due to a range of circumstances, including:

• Job Loss or Reduction in Income: Sudden unemployment or reduced hours can make it impossible to keep up with mortgage payments.
• Medical Emergencies: Illness or injury can lead to overwhelming medical bills, and a person may struggle to meet their financial obligations if they need to take time off work.
• Divorce or Separation: The end of a marriage can result in disputes over property ownership, and an ex-spouse may no longer be able to make ongoing mortgage payments on a single income.
• Adjustable Rate Mortgage (ARM) Increases: Unexpected increases in monthly payments may make it impossible for a homeowner to avoid defaulting on their mortgage.

Legal Help With Foreclosure Defense From an Experienced Lawyer

A homeowner who is facing foreclosure will need to understand what options they may have to help avoid the loss of their home, and they can do so with the help of an attorney who has experience in bankruptcy and debt relief. A skilled lawyer may be able to negotiate with mortgage lenders or other creditors, or they can help a person complete the bankruptcy process successfully, providing them with relief from their debts and making sure they can maintain financial stability.