The Foreclosure Stage

As institutions (banks, lenders, etc.) lend money to persons to buy a home or other property, they, of course, expect to be paid back. They are in the business of lending money to make a profit (hello?!). When borrowers (mortgagors) fail to meet their mortgage obligations, lenders want the property returned so they can re-sell it to others for a profit or at least reduce their losses. They retrieve the property through the foreclosure process.

Of course, both mortgagors and lenders will do their utmost to work out an agreement that will allow people to keep their homes and the lender to keep receiving payments. In addition, neither the mortgagors nor the lenders want the legal complications of the foreclosure process. Unfortunately for them—but fortunately for you!—they can’t always work out an agreement, and the lenders have to initiate foreclosure proceedings.

So, how is the foreclosure process begun and what’s involved in it? It’s important for you to be aware that every state and county has different rules and regulations that you’ll need to learn well. Otherwise, you may miss something or make a mistake than can cost you money. However, as a whole, every state within the U.S. uses among two types of foreclosure—judicial and non-judicial.

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