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In states like New York, Florida, and Maryland, foreclosures are conducted “judicially;” meaning through the court system. Judicial foreclosures afford many procedural rights to the homeowner, and often allow for a potential loss mitigation option to be explored before the foreclosure can proceed. These types of foreclosure take months or even years to complete. Many homeowners are under the erroneous belief that they can “wait it out,” choosing to defend the foreclosure once it has progressed. This is most certainly a mistake. Various potential defenses are waived if they are not asserted in an answer at the outset of a foreclosure case, and if the homeowner does not participate in mediation sessions, they may lose their best opportunity to modify their loan.
The urgency to seek help is even more important in non-judicial states. In states like Texas and Georgia, where there are no mortgages but “deeds of trust,” foreclosures are conducted by means of notice and sale. Once the loan is accelerated, the lender does little more than advertise and give notice of the sale. In these states, in as little as 30-45 days, a home can be put on the auction block. States like Texas and Georgia have “foreclosure days” on the first Tuesday of a given month when all foreclosure sales are conducted. Homeowners in these states do not have the luxury of time; they need to engage the lender as soon as they fall behind, not when they get a notice of trustee’s sale.
Being served with foreclosure papers is one of the most nerve-racking events a homeowner can face. As a practitioner of foreclosure defense, many potential clients call or meet with me after this has occurred. Strangely enough, I am often asked “what happens if I just ignore it?” As odd as that question sounds, it seems like a legitimate option for a homeowner in distress. As an attorney who sees these situations frequently, I simply advise the potential client that ignoring acceleration or foreclosure documentation is the worst thing they can do if they would like to save their home.
Even more immediate for many homeowners is that foreclosure actions are public record. The negative perception of a foreclosure action is often enough for certain people to act. Once that action is filed, investors, attorneys, and others will begin to call or show up at your home soliciting your business. To avoid all of this, I encourage distressed homeowners to see mortgage assistance even before being served.
My advice to all homeowners is “Don’t Wait, ACT.” By being proactive and engaging the lender as early as possible, you can obtain a workout before a foreclosure case can progress. This will help you avoid sleepless nights and anxiety that certainly will occur with a foreclosure sale looming. I work with homeowners in every situation, and have been able to obtain positive results for the vast majority of them. I am certain that other attorneys who practice in this field can attest to the same. I implore anyone who has fallen behind on their mortgage payments and is in fear of a foreclosure to seek the advice of an attorney with experience in foreclosure defense and loss mitigation.
If you are facing foreclosure,you may encounter these 5 steps
Step 1: The lender files summons and complaint with the court, which initiates the lawsuit.
Step 2: An affidavit of service is issued as a request for Mediation. At this time, foreclosure can be put on hold during the mandatory mediation process.
Step 3: The borrower files an answer. After the judge signs the Judgment of Foreclosure and Sale, the lender publishes a notice about the auction in a newspaper at least 30 days before the auction date.
Step 4: Within 60 days of filing the affidavit of service, the court must hold a mandatory settlement conference to see if the lender and homeowner(s) can reach a mutual agreement solution.
Step 5: Litigation and discovery.
Phase A: If a settlement cannot be reached, litigation begins and the case goes into the discovery process.
Phase B: The lender files a Motion for Summary Judgment if it believes the borrower’s defense lacks evidence.
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