Dodging foreclosure

Posted on 19 May 2009 by Carl Martens

Foreclosure is the legal and professional proceeding in which a mortgagee, or other lienholder, usually a lender, obtains a court ordered termination of a mortgagor’s equitable right of redemption.  Usually a lender obtains a security interest from a borrower who mortgages or pledges an asset like a house to secure the loan. If the borrower defaults and the lender tries to repossess the property, courts of equity can grant the borrower the equitable right of redemption if the borrower repays the debt. While this equitable right exists, the lender cannot be sure that it can successfully repossess the property, thus the lender seeks to foreclose the equitable right of redemption. Other lienholders can also foreclose the owner’s right of redemption for other debts, such as for overdue taxes, unpaid contractors’ bills or overdue HOA dues or assessments.

What the heck does that mean?

Basically, failure to act means you could lose the right as a homeowner to the ownership rights of your house and forfeit these rights to your lender.

Foreclosure is what happens when a home owner chooses not to act.

The process of foreclosure is a voluntary decision on the homeowner’s part.  The inability to not be able to afford one’s mortgage does not mean that the home will be foreclosed.  The homeowner has options.

sitting-in-the-middle-of-the-roadFor example, you can choose to stand in the middle of the road.  When the truck comes you have two choices; get run over or move out of the way.

Likewise, when a homeowner is unable to meet their financial obligation they have two options; not pay anything and get foreclosed on or be proactive and contact the bank or attempt a short sale (amongst other options).

Once the process has started there is no guarantee that the homeowner will be able to prevent the process, however not making any attempt to prevent it will ensure that the home is foreclosed.

If you find yourself standing in the middle of the road you can choose to dodge the truck, however you may still get run over.  Your survival is dependent on how far in advance you see the truck moving towards you and how quickly you react to it.

The same is true with foreclosure…the quicker you act the more likely you are to dodge it.

If you are facing foreclosure and want to learn how you can become proactive and attempt to avoid the process, contact us, your Certified Distressed Property Expert and Atlanta foreclosure and short sales experts.

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