Q:

What is the house foreclosure process?

A:

Quick Answer

The home foreclosure process begins with missed mortgage payments and failure of the borrower to meet lender-specified alternative payment deadlines, according to the U.S. Department of Housing and Urban Development. If negotiations for an alternate plan fail, a foreclosure sale is scheduled, typically after three missed payments.

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Full Answer

The third month of mortgage non-payment is key in the foreclosure process, per the foreclosure timeline available from HUD. When a borrower misses a third payment in a row, the lender sends a "demand letter" or "notice to accelerate" to the borrower that gives the borrower a 30-day deadline to make the back mortgage payments and avoid foreclosure. At the fourth missed payment, the lender's attorney works with the borrower at the borrower's expense.

If the borrower does not reach an agreement with the lender's attorney, the foreclosure sale is scheduled, explains HUD. Borrowers and lenders can continue to negotiate until the date of the sale. The HUD timeline also describes a redemption period after the foreclosure sale. During this period, it is possible for a borrower to reclaim ownership of his home by making all outstanding mortgage payments and paying any other foreclosure process costs. The foreclosure process and timeline vary by state and also by type of foreclosure. Housing counseling is usually available throughout the process.

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