Foreclosure Process
The amount of time you have in the foreclosure process will depend on a number of factors such as the state, lender and your ability to catch up and pay.Here are the general foreclosure steps that exist in most states.
1. Notice of Default (NOD)
This is when the mortgage servicer will send a formal Notice of Default. This legally starts the foreclosure process. This is the best time to stop the home from being foreclosed. Notice of Defaults are usually sent out when the loan borrower is 2-4 months behind on their mortgage payments. Keep in mind that the loan servicer can actually send the NOD after the first missed mortgage payment.
2. Pre-Foreclosure
After the initial Notice of Default, the home will be prepared to go to an auction to sale the home so the loan can be paid off.
3. Foreclosure Auction Sale
This step is the actual auction where the home will be auctioned off at your local city's court house. Any proceeds will go to the lender with the loan as well as any other fees in the foreclosure process. If there are any profits, the banks and attorneys keep them.
The most important step to take in trying to prevent foreclosure of your home is to take action right away. Ask for help from foreclosure specialist. Generally, these foreclosure specialist will attempt to refinance your home if there is enough equity in it. Please keep in mind that since you are in the foreclosure process, you will end up with higher loan rates.