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What is Foreclosure and How Can You Stop It?

Thousands of American homeowners face home foreclosure every year. Don’t get blindsided by foreclosure if you are having financial difficulty and find yourself in this situation. Stay informed and get the foreclosure help you need.

The foreclosure process is lengthy and can get expensive. By taking a look at your finances and communicating with your mortgage lender near Petaluma, you might be able to avoid the whole foreclosure process entirely.

So, what is foreclosure and how do you avoid it? Let’s delve into the foreclosure process in California.

What is Foreclosure?

Foreclosure is a legal measure where a lender sells your home to get back the amount of money owed to them. This usually happens when the borrower defaults on their loan payments and/or violates the conditions of their loan agreement.

What is Pre-Foreclosure? 

In most cases, lenders will try to work with borrowers before resorting to foreclosure to create a payment plan. This is known as the pre-foreclosure process. The foreclosure is actually the last step in the process.

What is Non-Judicial Foreclosure?

While judicial foreclosure occurs in states where the lender has to go through the judicial system to get permission to foreclose on a borrower, California is a non-judicial foreclosure state. This means that they don’t have to go through the court to foreclose on a home.

Foreclosure Timeline

A lender will send a Notice of Acceleration to borrowers who have missed two payments. The borrower must set up a payment agreement to make up for the missed payments.

When a borrower has defaulted on payments, the lender will record a “Notice of Default”. The borrower then has 90 days to arrange for payment to reinstate the loan with the lender. Otherwise a notice of Trustee sale will be recorded

If the payments continue to default, the lender will proceed with foreclosure when the Notice of Default expires.

How To Avoid Foreclosure in the Petaluma Area

It is possible to avoid a foreclosure when you consider all of your options.

Talk to Your Lender

You may find that talking to your lender will help you to agree to pay back the money that you owe. If you can get back on track, you can keep your Petaluma home.

Sell Your Home

It is possible to avoid the negative consequences of foreclosure if you decide to sell your home to settle your mortgage debt.

File for Bankruptcy

Two types of bankruptcy can help you avoid foreclosure on your property. A Chapter 7 Bankruptcy can delay the impending foreclosure and wipe out the debt associated with the mortgage. A Chapter 13 Bankruptcy will allow you to keep your home and catch up on payments that you’ve missed with a payment plan.

Before considering filing for bankruptcy, you should speak with an attorney who specializes in home foreclosure to see what other options may be available to you.

Are You Facing Foreclosure Near Petaluma?

Now that you know what foreclosure is, you will be able to make more informed decisions about paying your mortgage and be able to talk to your lender when you are having trouble making these payments.

If you find yourself in a situation where you’re facing foreclosure, you should reach out to a real estate and foreclosure law expert near Petaluma to get you through this difficult time.

Contact the Estavillo Law Group with any questions you may have regarding foreclosure laws in your area.