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How To Stop Foreclosure Anxiety-4 Stages of The Foreclosure Process

Updated on September 10, 2013

How To Stop Foreclosure Anxiety and Confusion


There was a family I know of that who almost lost their home to foreclosure because of a loss of one of two income. They thought they had enough savings to make it through un-scabbed. They were wrong. The bills began to pile up (while job searching) but no in the household thought to call their mortgage servicer to ask for mortgage assistance.

As months went by they went from making late payments (and ignoring letters from the bank) to eventually missing mortgage payments altogether.They still made no calls to the mortgage servicer or bank. Finally they became brave enough to open a notice from the bank. They experience a sick sense of horror and realized if they don't act they will lose their home.

Now highly motivated this family finally began aggressively seeking help and was fortunate enough to run into a friend that was in the same situation before. After being coached on what to do next they:

  • Received temporary burden of payments.
  • Lower payments (Loan Modification)
  • Home was saved.

Come to find out they could have gotten help months ago but like millions, they had no clue what to do and was too embarrassed to ask for help.

They took a great risk from waiting and could have lost their home like millions by being too afraid and uninformed to act. Not all can save their homes, but you will never know unless you are proactive.

How To Stop Foreclosure Confusion

4 Tips To Loan Modification or Pre Foreclosure Process

  1. Notify bank at first signs of financial trouble and ask for options.
  2. Answer and respond to every letter from the bank immediately.
  3. Seek counseling from government or reliable programs.
  4. Save all money during the litigation (Time allowed with no mortgage payments while modification decision is decided.) process. Banks can now take your home weeks after denial of Loan Modification. You can get a LDA Report and find out if you qualify before litigation is over. (Remember the banks protect their bottom line.)

It is very important to know the Foreclosure Process in order to plan and exit or stay strategy. You will have to contact your States Government Housing Office for specifics in your state. This is only information to take the mystery out of the foreclosure process

4 Stages of the Foreclosure Process

  1. After a few months of being behind in your mortgage payments you will start receiving those dreaded letters (Notice To Accelerate) from your bank. They will ask for back payments with pay be a specific date.
  2. The next letter is called a Demand Letter. You will receive it if you have not bought your mortgage up to date as directed. It will be sent from a bank hired attorney demanding action to your Notice to Accelerate letter. This means you have been officially notified before court proceeding.Should this matter be taken into court you will also be responsible for court and attorneys fees.
  3. If you have ignored the letters up until now you will receive a Notice of Default. This is the second stage of the foreclosure process. The bank will now file a foreclosure lawsuit or Notice Of Default with the county recorder. You will receive a letter of this judgement.You have approximately 30 days to respond. The hearing (court date) is then set at your county courthouse. If you don't respond with payment the bank will win and go forward with the foreclosure process.
  4. If you have not responded to the Notice of Acceleration, Demand Letter or Notice of Default you will be sent a Notice of Sale with in 20 to 30. Today the banks are backed up so it may take longer.The property is then auctioned off in a sheriff sale. This is the worst time for those living in the home. Every state works differently but this time can be very devastating for the family of the foreclosed property.

Knowing what to expect can take some of the anxiety out of this devastating experience. I just wanted to add that knowledge is power. Make a plan during the good times to avoid the bad times. Learn how to save your home while you are in good standing with your banks or first signs of financial hardship. Wouldn't you like a lifeguard around in case of drowning at the beach?

Know that your bank will work with you if you lost a source of income or have had an illness that prevents you from working. They actually don't want to worry about another house. However they will do what is best for their bottom line. Click this link to learn more about "how to stop foreclosure".

Comments

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    • profile image

      PrimeLegal 

      4 years ago

      The banks are now doing a tricky practice called Duel Tracking.This will allow them to get you out of your home easily and quickly after wasting your precious time and denying your loan modification.

      Get an LDA report and know right away if you qualify and use the time during litigation to save money and get real help saving your home. http://primelegalservices.blogspot.com

    • Elearn4Life profile imageAUTHOR

      Darlene Matthews 

      4 years ago

      Thanks for reading!

    • MsDora profile image

      Dora Weithers 

      4 years ago from The Caribbean

      You're right about lessening the anxiety by knowing what to expect. Thank you for explaining this.

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